Understanding the Bankruptcy Process

As you may know, bankruptcy is a court proceeding in which a judge and court trustee examine the assets and liabilities of individuals and businesses who cannot pay their bills. Then the court will decide to discharge the debts and you will no longer be legally required to pay your debts.

If your finances have gone wrong and you find yourself surrounded by debt, you can ask for a second chance, that’s where bankruptcy comes in place. Individuals or business owners can file bankruptcy; both can petition U.S. Bankruptcy Courts to release you from debt and start your financial life with a clean slate.

Chapters in Bankruptcy

There are two main types of bankruptcy available to individuals. In Chapter 7, the consumer can have all or part of his debts discharged after the liquidation of his non-exempt assets to pay part of the debt, often without losing any assets. In Chapter 13, the consumer can repay part or all debt with a 3-5 year payment plan. Most people choose to file Chapter 13, to keep all of their assets.

The basic process to file for bankruptcy would be to confirm that you really can’t pay your debts, then choose a bankruptcy attorney to help you choose the best option that fits your case. Since personal bankruptcy laws are complicated, good advice is to seek professional help from an attorney before filing for bankruptcy. This is the best way to make sure your paperwork is filed completely and accurately.

Debt Relief

Both options of bankruptcy (Chapter 7 and Chapter 13) may help you with foreclosures, repossessions, garnishments, utility shut-offs, and debt collection. Both types provide exemptions that allow people to keep certain assets, but the exemption amounts vary. Personal bankruptcy usually does not erase child support, alimony, fines, taxes, and some student loan obligations. These will remain active even with the bankruptcy process.

A trusted Roseville bankruptcy attorney may prove helpful in solving your debt problems.