How to File for Bankruptcy

Posted on January 1st, 2009 by monsterguide

(No Ratings Yet)

Loading ...

No Comments (Post Comment)

Republish

Here are a few simple steps to file for bankruptcy.

Step 1: Gather all financial information

Before filing, get all of your financial records together in a file. This file should contain all of your past due bills, repossession notices, and any judgments you may have against you. In addition to these items, you will also want to include your bank statements and mortgage information.

Step 2: Contact a bankruptcy attorney

You will want to find a bankruptcy attorney with a good reputation. They are not hard to find. If you watch any local television at all you have seen these attorneys’ advertisements. One of the best ways to find a trustworthy attorney is through word of mouth. Since bankruptcy can be an embarrassing feat, you can find a good bankruptcy attorney by contacting the bar association for the state you will be filing in.

Step 3: Discuss your debt with the attorney

There are two types of debts, secured debt and unsecured debt. Secured debts are debts such as mortgages or vehicles. These debts allow the creditor to take their property back if you default on the loan. Unsecured debts are credit cards or personal loans. These loans are not secure by personal property, thus the creditor cannot repossess any real property due to default.

Step 4: Carefully dictate your bankruptcy paperwork

The paperwork filed in the bankruptcy will contain information on all your creditors as well as all of your assets. Be sure all your creditors are listed. If you leave a creditor out, you are not protected against them. Also, be aware when listing your assets such as land and property. If you try to hide assets or lie in any way, you could be convicted of a federal crime.

Step 5: Chapter 7 or Chapter 13

Now that your attorney has all the information they need in order to proceed with the filing, it is time to figure out which type of bankruptcy you should file. Chapter 13 or consolidation is best for people who have steady incomes, but are behind on certain payments. Chapter 13 does not wipe all debt away; it simply consolidates the payments into one payment made to the court. The funds are then distributed to the creditors based on the schedule they agree to in the bankruptcy petition. Chapter 7 wipes your debt clear, but you could lose personal property such as your houses or vehicles.

By getting yourself organized with these steps, you will have a smooth transition into your bankruptcy. After your bankruptcy is filed you will have instant protection from your creditors.