Filing for bankruptcy can be a powerful remedy for those facing serious debt problems. It can help a person rule out a debt or make a plan to repay it. A bankruptcy case normally begins when the debtor files a petition with the bankruptcy court. This petition can be filed by an individual, by spouses together, or by a corporation or other entity.
At the end of a successful Chapter 7 filing, most (or all) of your debts will be settled, meaning that you will no longer have to pay them. Some debts that won't be settled in the event of bankruptcy include alimony, child support, some types of unpaid taxes, and some types of student loans. Upon successful completion of the bankruptcy procedure, the debtor is exempt from the debt obligations incurred before declaring bankruptcy. When you are faced with financial difficulties, it is essential to know what happens in the event of bankruptcy before you decide to file a bankruptcy case. Filing for bankruptcy stops most lawsuits, wage garnishments and other collection activities. It also eliminates many types of debt, including credit card balances, medical bills, personal loans, and more.
Bankruptcy is meant to give you a second chance; a fresh start with your finances. However, not knowing what happens after you file for bankruptcy can be frightening. When a bankruptcy application is filed with a court, creditors are notified and can file objections if they wish to do so. The two main types of bankruptcies filed under Chapter 7 and Chapter 13 offer unique benefits and, in some cases, treat debt and property differently. Bankruptcy will not forgive a fraud-related debt if a creditor files a lawsuit called adverse procedure and convinces the judge that the obligation must remain in effect after the bankruptcy. Use the forms that are numbered in the 100 series to file for bankruptcy for individuals or married couples.
People who participate in more than 95% of all Chapter 7 bankruptcies filed in the United States keep all their belongings. In a Chapter 7 case, creditors can foreclose on the property even after you file for bankruptcy if you don't pay your secured debts. If you filed Chapter 7, the trustee may liquidate some of your non-exempt assets and distribute them to creditors in accordance with the priorities set out in the bankruptcy laws. Child support and alimony obligations survive bankruptcy, so you will continue to owe these debts in full, as if you had never filed for bankruptcy. Individuals and, in some cases, companies, with few or no assets, often file for bankruptcy under Chapter 7.If you have never filed for bankruptcy before, pass the appeals test, and are honest in your dealings with the bankruptcy court and bankruptcy administrator, you can get your bankruptcy relief in as little as 3 months. Any decision in federal bankruptcy cases is made by a bankruptcy judge, even if the debtor is eligible to file an application and if their debts should be forgiven.
In theory, the possibility of declaring bankruptcy benefits the overall economy by allowing individuals and businesses a second chance to access credit and by providing creditors with a portion of the debt repayment. Bankruptcy proceedings are filed in a system called Public Access to Electronic Judicial Records (PACER) for its acronym in English. You can file for bankruptcy on your own or find a lawyer who specializes in bankruptcy - which most experts consider to be the prudent path to follow. Bankruptcy is a legal process that begins when the debtor files a petition with the appropriate bankruptcy court. Knowing what happens when you file for bankruptcy in the US is essential if you are faced with financial difficulties.
