Key Bankruptcy Law Considerations To Keep In Mind Before Filing For One

Bankruptcy is a powerful remedy when you are facing serious debt problems. Filing for bankruptcy will enable you to stop almost all of the collection actions which include wage garnishes, lawsuits as well as telephone calls. You can also eliminate debts from a credit card, personal loans, medical bills and much more.

Law Considerations

However, many creditors remain unaffected by filing bankruptcy, and these include student loans, child support, alimony, and tax debts. It is therefore highly important to have an understanding of what filing for bankruptcy can and cannot do.

In the following article, our experts have compiled a unique guide for you to understand everything you need to know before filing for bankruptcy. But first things first! You need to hire an expert lawyer to help protect your interests. Find your legal expert and representation at www.friscialaw.com/.

So, without further ado let us get into the details of bankruptcy law and how it might aid you in case of accumulation of debt.

How can bankruptcy aid?

When you have accumulated a certain amount of debt, it is essential that you get a fresh start. Filing for bankruptcy will help you to get that fresh start. There are two types of bankruptcy to file, which are Chapter 7 and Chapter 13 and each has its own set of benefits.

Stop the harassment and creditor calls

When you file for bankruptcy, the court immediately issues the order of automatic stay which means most of the creditor calls and lawsuits will be stopped. However, the support payments and criminal cases if any will still be pursued.

A temporary stop to the loss of property

Filing for bankruptcy will stop a foreclosure, repossession or eviction at the very least temporarily or while they are still pending.

If the eviction is in litigation, it will come to a halt in case you file for bankruptcy. However, it is just a temporary reprieve as the landlord has already issued an eviction judgment against you.

A foreclosure or repossession can be automatically stopped by filing a Chapter 7, but it won’t let you keep the property permanently. You will lose the property once the stay order has been lifted. Contrastingly when you file for a Chapter 13, it will allow you to catch up to the past dues and help you to keep the asset.

Credit card debts

You can wipe out your credit card and other non-priority unsecured debts by filing for bankruptcy. These include the medical and other utility bills along with personal loans and gym contracts. Other than the school loans all other non-priority debts can stay.

Key details to keep in mind about bankruptcy chapters

  • Chapter 7 bankruptcy takes on an average 3-4 months to complete
  • Chapter 13 bankruptcies will require you to pay back some portion of the unsecured debt through a 3-5-year plan. Any debt balance that remains after completing the repayment will be discharged.

What Bankruptcy Can’t Do

Here are a few things filing for bankruptcy cannot help you with

  • A secured creditor will be able to foreclose and repossess a property you cannot afford.
  • Bankruptcy cannot eliminate child support and alimony obligations.
  • Your student loans cannot be eliminated.
  • Debts that are not listed in the official filing papers.
  • Debts for personal injury or accidents due to driving under the influence.

Keep in mind these considerations and enlist the help of a legal expert before filing for bankruptcy.

kasi

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