Do you dread going to the mailbox because you don’t want to see which bills or overdue notices await you? This can be stressful and leave you in a troubled financial situation. If you’re deciding between getting groceries or paying a credit card bill, it’s time to get help.
Filing for bankruptcy can be your ticket to alleviate financial stress. When you partner with the right bankruptcy attorney, you can smoothly navigate the bankruptcy process and get on the path to financial freedom.
Bankruptcy Basics
When you file for bankruptcy, you are starting a legal process. The court will oversee the procedure and determine if you can file to help you get out of debt. There are two main types of bankruptcy for individuals: Chapter 7 and Chapter 13.
- Chapter 7: Often called a “liquidation bankruptcy,” Chapter 7 may require some assets to be sold to repay creditors in certain situations. However, most of the time, you can mark your assets as exempt. This allows you to retain possession of critical assets, like your car and household items. The remaining debt is discharged throughout the Chapter 7 bankruptcy process, meaning you do not have to repay it.
- Chapter 13: This chapter involves creating a repayment plan that lasts 3-5 years. This prevents you from liquidating your assets. However, you must make monthly payments to a court-appointed trustee. The trustee will then distribute the funds to your creditors. Once the plan is completed, any remaining eligible debt is discharged.
The Benefits of Bankruptcy
While there are a lot of steps that need to be followed to complete a bankruptcy successfully, it can offer numerous advantages. In addition to providing debt relief, it can also provide the following benefits:
- Debt Elimination: Bankruptcy allows you to discharge a significant portion of your debt. This gives you a fresh start.
- End Creditor Harassment: When you file for bankruptcy, you get freedom from creditor harassment. Creditors are legally obligated to stop harassing you for payments when you start the bankruptcy process.
- Reduced Stress: The overwhelming burden of debt can be extremely stressful. Bankruptcy can alleviate this pressure, allowing you to focus on rebuilding your financial future.
- Improved Credit Score: While bankruptcy will stay on your credit report for some time (7-10 years), it isn’t on there permanently. Working with your bankruptcy attorney, you can build good financial habits and take critical steps to improve your credit score and lending power over time.
- Opportunity to Rebuild: Bankruptcy provides a chance to establish new spending habits and budgeting strategies. This gives you control over your finances and allows you to build a more secure future.
Steps to Filing Bankruptcy
If you’re considering bankruptcy, one of the most critical steps you need to take is to hire an experienced and trusted bankruptcy attorney. An attorney can review your situation and help you determine if you should file for Chapter 7 or Chapter 13 bankruptcy. They will advise you on the pros and cons of each and guide you through the entire bankruptcy process.
In addition to hiring the right bankruptcy attorney, you should also take these other essential steps:
- Gather Financial Documents: Organize your financial statements, debt records, and income information. The more information you provide to your attorney, the better view they will get of your financial situation.
- Explore Alternatives: Before filing for bankruptcy, you should explore other options to reduce your debt, including consolidation or settlement options with your creditors. However, these options are not always available. It’s important to discuss all options with your attorney. They will help you select the best choice for your situation.
- Budgeting for the Future: Develop a realistic budget that allows you to manage your finances responsibly moving forward. You can pursue credit counseling and other services to help you create a budget you can stick to and one that prevents you from falling back into debt.
Let Us Help You
If you are deep in debt, filing for bankruptcy can provide a path to financial freedom. Let our lawyers at the Law Offices of Alexzander C.J. Adams, P.C. help. We work for you, the people, and not institutions. Contact us for a free case evaluation or no-obligation consultation. We are dedicated to helping you overcome this minor bump in the road and getting on with your life.
