Important Aspects to Know When You File for Bankruptcy
Whereas the process of applying for some loan can be as simple as meeting the qualifications, situations may arise when you are not able to pay the loans back. The most commonly asked question by most debtors who have a hard time settling the debts is what next for them. Even though bankruptcy is never a nice topic for most business and people, it is already with us and the best we can do is to enlighten you on the right step to take should you be a victim. Through the article herein, you will learn more about what happens when you file for bankruptcy.
To begin with, you need to know how it all happens in court. The decision about bankruptcy is made in court and this is through a judge and an independent contractor who is hired for this service. The two parties will take their time and have a review and finally make a decision whether you are eligible for bankruptcy or not.
It is also important to note that various types of bankruptcy exist just as explained in this website. Among the various types of bankruptcy is chapter 11, chapter 12 and chapter 13 whereas chapter 7 is the most common one. You also ought to know that chapter 12 is in most cases occupation-based occupation-based. Although chapter 7 bankruptcy may forgive most of the debts, you may have to sell some of the important bassets that you own to pay the debt.
As a debtor, it is important to know that this process is very long as well as expensive. Remember you will have to meet the credit counselor for bankruptcy and debt as well as putting all the relevant information in place for the process. You should also be at the frontline to show the court that you have made the best effort you could in an attempt to fix the situation.
You also need to know that normally there are plans to have a look at your financial situation as arranged by the court. This is done by the court trustee, the lawyer and the creditor. You should, however, have it that the process takes several days or even months and in some cases could go as long as 6 months. With the tips above, you will know all things that are important to you before you file for bankruptcy.