Chapter 7 Bankruptcy

Filing chapter 7 bankruptcy is not an easy decision to make. Unfortunately, millions of Americans are struggling to manage their debts. While filing bankruptcy should not be the first choice, for many it is the only available solution. If you have tried debt management programs and failed, bankruptcy may be the only way you can have a fresh start.

How Chapter 7 Bankruptcy Works

If you have a high amount of consumer debt and do not own property, Chapter 7 may be a viable solution. This bankruptcy can wipe out consumer debts and provide you with the opportunity to gain control of your financial future.

The process begins with completing a petition to file. The petition requires a list of debts, income and assets. If the bankruptcy court approves your petition, your debts can be discharged.

The discharge of debts means you never have to repay the debts listed on your petition. In addition, your creditors must cease all collection activities on those debts.

The most difficult part of filing is the paperwork. You can file on your own; however, we do not recommend this method. If you visit the Federal courts website, the courts dissuade individuals from filing without an attorney. The process is complex and a misstep can result in your case being dismissed.

If you own significant assets such as a home, we recommend you seek the advice of an attorney to find out the appropriate bankruptcy you may need to file. You do not want to risk losing your home by filing the incorrect bankruptcy.

Life after Chapter 7 Bankruptcy

Once your bankruptcy is discharged, it will remain on your credit history for up to 10 years. This will make it difficult to obtain credit for quite some time. However, most people who file learn to live without credit cards.

A bankruptcy on your record may make it difficult to obtain employment if the employers require a credit check as a condition of employment.

In some instances, it may make it difficult to obtain car insurance and a bank account. Some insurance companies and banks will conduct a credit check. If you have a checking account before you file bankruptcy, you should keep the account open.

If you need a new car or need to borrow money for any reason, you may have to apply for high-risk loans, which carry a high interest rate. You can begin to build credit by obtaining a secured credit card. Once you establish a good payment history, you may be able to obtain a car loan with a lower interest rate.

The clear advantage of filing bankruptcy is the collection calls stop immediately upon filing. While the bankruptcy will remain on your credit history, bad credit is just as detrimental. Most people are able to rebuild their financial life after bankruptcy. However, if you do not file, the debts may haunt you throughout your lifetime.

The relief people feel once they have received their discharge, it tremendous. Most people want to pay their debts but are crushed by late fees and high interest. If you are unable to meet your payment obligations and are getting deeper in debt, we recommend you speak with a bankruptcy attorney to find out if chapter 7 bankruptcy is right for you.

If you are unsure or uneasy about filing bankruptcy, we recommend you get a consultation with an experienced attorney. Most lawyers will offer a free consultation to review your case. A lawyer will explain how bankruptcy can help and what to expect during the process. It is true that you do not need to hire a lawyer; however, once you discover the amount of paperwork involved, you will likely want to reconsider.

We must also mention that according to uscourts.gov, those individuals who file on their own are rarely successful. In some cases, people have lost their right to file due to a procedural error. Hiring a lawyer is the most costly method of filing; however, it is the most effective method. You will know all your paperwork and documents are in order when your attorney files your case.

If you are considering chapter 7 bankruptcy, we strongly recommend you seek the advice of a bankruptcy attorney. This is the best and safest method of filing. In addition, you may have assets that you do not want to lose. Filing the incorrect bankruptcy can cause you to lose those assets. In addition, an attorney will ease your mind about filing. Too many people feel guilty or ashamed that they have to file. The bankruptcy law is designed to give people a second chance. You should not feel guilty or ashamed because you need this second chance.