Inability to pay bills or keep a business afloat is one of the scariest places to be. It usually comes with chaos, which includes creditors knocking at your door, lawsuits, and other disruptive complications. However, it is possible to end the stressful experiences by filing for bankruptcy. When you file, you buy yourself time to put your finances in order and get back on your feet. Here are some of the commonly asked questions about filing.
What Does Filing Accomplish?
The first question people ask when faced with the decision is how going through the complex process will help. People file for bankruptcy to eliminate all their legal obligations to pay debts. When you file for bankruptcy, you also eliminate the chances that the mortgage lender will foreclose your home. It can also help stop the bank or other lenders from repossessing your vehicle. In short, it is the ideal way to buy the time you need to get your life back in order without losing your assets.
What Will You Not Accomplish by Filing?
It is also great to find out what you will not achieve by filing for bankruptcy. For example, you will not resolve a secured debt from a creditor. For example, you cannot get exempted from paying the creditor if you borrowed a loan and used your mortgage or car as collateral. The best that filing will do in such a case is to offer an opportunity to restructure the debt. Also, some debts you acquired several months before will still be your responsibility. These include court fines, spousal, and child support. You can consult the lawyer about all these issues, so you can file for bankruptcy with a clear picture of what it will do.
Are There Different Types of Bankruptcies?
It is also crucial to learn about the different types of bankruptcy operating within the legal system. The most common are chapters seven and thirteen. Chapter seven involves forfeiting the property to a trustee and getting the debt discharged. On the other hand, chapter thirteen is a strategizing approach where you get several years to plan and repay the debts. Your bankruptcy attorney will help you determine the ideal option.
A good place to start your research about this topic is by speaking to a bankruptcy lawyer. They will share everything you need to know about the filing process and ensure it goes smoothly.