Declaring Yourself Bankrupt – Some Advice
Until recently, credit was easy to obtain. In the light of the financial crisis, institutions and banks have become less inclined to extend credit and that same crisis has suddenly brought massive insecurity to many as they struggle to cope with high levels of debt.
Credit cards have played a major role in this. We all know how easy it is to live beyond one’s means by supplementing our spending with credit card debt. The problem is that it has to be paid at some stage, and for some, just the monthly interest is more than they can afford.
Simply transferring debt to a card with a lower interest rate will give the borrower some time to think, but this is only a temporary state of affairs.
For many, the chance of wiping away this debt and starting again with a clean financial slate is very appealing. Declaring yourself bankrupt can do this, but should only be considered after some serious thought as to whether or not the situation can be saved, and should be only ever be a last resort.
A number of commercial organisations have appeared recently offering to help with your bankruptcy,. I have no personal experience of them, but suggest you tread very carefully if you are thinking of employing one.
Although it may seem expensive, I would recommend that you hire a specialist bankruptcy lawyer from the outset, one that understands your state’s bankruptcy laws. This is your financial future at stake and you want the best advice you can afford.
Before declaring yourself bankrupt, you need to check that you are, in fact eligible. There are 3 possible reasons for ineligibility.
If you have voluntarily dismissed a bankruptcy case of your own in the last 180 days.
If you have previously declared yourself bankrupt and received the discharge within the last seven years you are ineligible.
If a previous bankruptcy petition was dismissed due to your failure to adhere to the Bankruptcy Code, and this was in the last 180 days, you are ineligible.
Assuming you do not fall into any one of those criteria, you may proceed.
Your lawyer will advise you of the best type of bankruptcy for you to file under. There are several “chapters” or types of bankruptcy, the most common being chapter 7 and chapter 13.
Chapter 7 results in you losing virtually all of your personal property with the proceeds used to pay off as much debt as possible (after which any outstanding debt is no longer your responsibility), while chapter 13 is essentially a repayment plan, where you keep most of your possessions and repay all your debt over a 3 to 5 year period.
For additiaboutal helpful informatiabout about declaring yourself bankrupt, including tips about angles to caboutsider before filing and tips about lawyers, visit www.declaringyourselfbankrupt.net.
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Bankruptcy and Related Law in a Nutshell (Nutshell Series)This comprehensive guide covers bankruptcy issues and laws. Written by experts in the field, the text discusses judicial debt collection, creditors with special rights, debtors' state law remedies, commencement, conversion, and dismissal of a bankruptcy case, automatic stay of collection, creditors’ and debtors’ rights, exemptions, collection, and pre- and post-bankruptcy transfers. Also discusses the effect on secured and unsecured claims, leases and executory contracts, and allocation of judicial power over bankruptcy matters.
