Declaring Personal Bankruptcy - All the Steps You Need to Take in Order to Declare Bankruptcy
If you are declaring personal bankruptcy, keep in mind that there are two different ways you can go about this process-either chapter 7 or 13.
The other main chapter that people usually think of, chapter 11, actually only applies to businesses, so in the case of personal bankruptcy, you only have to worry about these two.
Obviously, this can be a very difficult and confusing process, so I will show you exactly what you need to do, step by step, to ensure you get the process right and get back on good financial ground as quickly as possible.
First of all, I will give you a quick and dirty definition of both chapter 7 and 13 bankruptcy so that you at least have a fair understanding of each (your lawyer will tell you much more when it comes time for declaring personal bankruptcy.
) Chapter 7 is where your personal assets are liquidated in order to pay off your debt.
Obviously, this is not a pleasant scenario, but sometimes is necessary if you don't have a sufficient level of income to pay off your monthly bills.
if you can't demonstrate that you do have the capacity to pay off your monthly bills, you will need to file for chapter 7.
However, if you can prove this, than you can and will actually need to declare for chapter 13.
in this scenario, your assets are not liquidated, since you have shown that you have the ability to pay off your bills.
This obviously sounds better on the surface, and may or may not be, but here's something you need to know about declaring personal bankruptcy.
Unlike chapter 7, which completely exonerates you after your personal assets have been liquidated (even if they don't cover all your expenses) with chapter 13, you are forced to pay off your bills over the next 3 to 5 years under the watchful eye of the court.
They will give you a plan to do so, and it's your job to follow it.
Again, neither way is necessarily better than the other, but these are just some facts you need to be aware of for declaring personal bankruptcy.
Again, if your income is at a sufficient level (your lawyer will give you the exact formula for how this is figured out) then you will have to file for chapter 13.
The other main chapter that people usually think of, chapter 11, actually only applies to businesses, so in the case of personal bankruptcy, you only have to worry about these two.
Obviously, this can be a very difficult and confusing process, so I will show you exactly what you need to do, step by step, to ensure you get the process right and get back on good financial ground as quickly as possible.
First of all, I will give you a quick and dirty definition of both chapter 7 and 13 bankruptcy so that you at least have a fair understanding of each (your lawyer will tell you much more when it comes time for declaring personal bankruptcy.
) Chapter 7 is where your personal assets are liquidated in order to pay off your debt.
Obviously, this is not a pleasant scenario, but sometimes is necessary if you don't have a sufficient level of income to pay off your monthly bills.
if you can't demonstrate that you do have the capacity to pay off your monthly bills, you will need to file for chapter 7.
However, if you can prove this, than you can and will actually need to declare for chapter 13.
in this scenario, your assets are not liquidated, since you have shown that you have the ability to pay off your bills.
This obviously sounds better on the surface, and may or may not be, but here's something you need to know about declaring personal bankruptcy.
Unlike chapter 7, which completely exonerates you after your personal assets have been liquidated (even if they don't cover all your expenses) with chapter 13, you are forced to pay off your bills over the next 3 to 5 years under the watchful eye of the court.
They will give you a plan to do so, and it's your job to follow it.
Again, neither way is necessarily better than the other, but these are just some facts you need to be aware of for declaring personal bankruptcy.
Again, if your income is at a sufficient level (your lawyer will give you the exact formula for how this is figured out) then you will have to file for chapter 13.
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