What happens when individuals are enveloped in debt? What happens when the money woes one has stack up and compresses them? What is the next step towards a future for them and their families? Bankruptcy can be an option for people who feel they have nowhere to turn. Bankruptcy can hinder your credit report for the next ten years but is an option in debt relief when there is nowhere else to turn.
When filing under chapter 7 or chapter 13 bankruptcy you can rid yourself of a substantial amount of debt that as accrued leaving you burdened. You will be protected under the bankruptcy code and alleviated from a variety of debts that you are responsible for. Declaring bankruptcy, whether chapter 7 or chapter 23, you should consider what you are doing. This step is serious and should only be considered in extreme cases after careful considerations to other viable options have been taken into account.
The laws within the bankruptcy codes change over time. To ensure you are getting the best assistance with your bankruptcy procedure hire a bankruptcy attorney that specializes in the laws surrounding bankruptcy. Recent bankruptcy changes have made it more difficult to qualify for bankruptcy. This option is only considered for individuals that are struggling to keep up with their payments. Not everyone will qualify for debt relief under the new rules and regulations associated with chapter 7 and 13 bankruptcy.
A chapter 7 bankruptcy allows individuals to completely eliminate debt without any repayment plan put in place. There is a means test that will determine if certain situations qualify for this type of filing. If however you make less than the median income for your state this law will not play into your bankruptcy proceedings.
It is important to remember that a bankruptcy filing will stay on your permanent report for ten years. It will hinder credit for the individual in the future. It does not mean you will never get credit just that you will pay higher interest rates on loans you are able to get. Over time you will be able to establish a new credit history and better interest rates will apply.
There is a thought that when individuals file for bankruptcy that they lose everything they have worked for. This is not always true. The protection you get under bankruptcy relief will tell you exactly what assets you are able to keep. In most cases, if equity in your home is not established you are able to keep paying on your home. The same is true for your cars. Luxury items such as recreational vehicles or items of great value may need to be handed over to the trustee to gain money to equally distribute to your debtors.
In order for individuals to file for bankruptcy they must use full disclosure of all of their current assets and current debts. Nothing is personal when it comes to your personal information during a bankruptcy proceeding. A qualified bankruptcy attorney will guide you through the requirements prior to filing.
Some debts cannot be included in bankruptcy relief. Some of these include student loans and medical bills. For these types of payments a schedule will need to be made to accommodate funds being applied towards paying off this debt.