Declaring bankruptcy in the USA can be a powerful remedy for those facing serious debt problems. It stops most lawsuits, wage garnishments, and other collection activities, and eliminates many types of debt, including credit card balances, medical bills, and personal loans. But what happens after you file for bankruptcy?When you file for bankruptcy, you'll benefit from an automatic suspension that notifies your creditors of your status and prevents them from contacting you. Your case will be decided by a bankruptcy judge based on the information you have provided.
If the court finds that you have attempted to hide assets or committed fraud, you may not only lose the case but also face criminal prosecution. Unless your case is complex, you generally won't have to appear before the judge in court. It's essential to know what happens in the event of bankruptcy before deciding to file a bankruptcy case. Hiring a bankruptcy lawyer can help you understand the process and deal with the complicated details. A bankruptcy case usually begins when the debtor files a petition with the bankruptcy court. The petition can be filed by an individual, by spouses together, or by a corporation or other entity.
If you have large debts that you can't pay, are behind on your mortgage payments and in danger of foreclosure, or are being harassed by bill collectors, filing for bankruptcy could be your answer. Filing for bankruptcy can affect your credit history and your ability to do certain things in the future. It's important to monitor your credit scores during the process and while you recover from it. As a result, filing for bankruptcy could affect your ability to get a new job, especially if it's in the financial services industry or in a government entity. Your lawyer will help you understand what happens if you file for bankruptcy and what debts were canceled when you filed for bankruptcy, as well as those that you might still be required to pay. Debts for money or property obtained under false pretenses, debts due to fraud or defamation acting in a fiduciary capacity, and debts for deliberate or intentional injury committed by the debtor to another entity or to the assets of another entity will be liquidated unless the creditor timely files and prevails in an action to have such debts declared taxable. People who participate in more than 95% of all Chapter 7 bankruptcies filed in the United States keep all their belongings.
