your options for getting out from under debt

Need To File For Bankruptcy? 3 Questions You May Have

Are you getting ready to file for personal bankruptcy? If so, the process can be quite complicated with all the rules you must follow for it to successfully go through. Here are some questions you may have about bankruptcy early on in the process:

Why Do People File For Bankruptcy?

Bankruptcy can become a necessity due to a variety of financial hardships. For instance, you may have medical bills that you will never be able to pay off in full, suffered from a bad financial investment that left you with debt, or have excessive credit card debt that you can't seem to dig yourself out of.

No matter what the situation is, bankruptcy can be used to help you pay those debts that you're unable to pay back to your credits. Bankruptcy gives you financial relief by using Chapter 7 or 13 bankruptcy.

How Do You Know Which Form of Bankruptcy Is Best?

If you feel you are capable of paying back your debts and just need some time to do so, Chapter 13 will be the best form of bankruptcy for you. The process will result in coming up with a debt payment plan to help reduce your debts over the next 3-5 years. The debts that you owe will be simplified by combining them all into one payment. Instead of paying back each creditor individually, you actually make a payment to the court which divides the payment up among all creditors.

Chapter 7 is quite different since debts will be discharged without actually having to pay them back. It does more damage to your credit over a longer, but may be the only option if you cannot repay the debt. Chapter 7 bankruptcy also involves liquidating some assets to pay off as much of the debt as possible, but know that your home will be protected.

Both Chapter 7 and 13 will protect you from being harassed by creditors. Creditors are not allowed to contact you about your debt, even though they are not getting it paid back as fast as they would like.

Should You Hire A Lawyer?

Bankruptcy is a legal matter that definitely should be taken care of by a lawyer. So many things can go wrong during a bankruptcy proceeding, and a worse case scenario is that the bankruptcy is not approved and you are stuck paying back the debt. A lawyer will give you the best chance possible of having debts discharged.

Contact a law office like Haven Law Group, P.C. for more information and assistance.