Important Bankruptcy Facts You Must Know When Considering Bankruptcy
Honestly, there is no other way to look at it. The Bankruptcy Process is quite confusing and can be very complex. The decision whether to file or not file a Bankruptcy can be filled with stress and a lot of fear. In addition to all that, the individual has the added burden of creditors hounding them at all hours and the uncertainty of what their financial future will actually be like in the future.
Thus, before one can entertain the notion of whether to file or not file, it is best to have certain truths about the process understood. As with any other endeavor, knowledge is helpful and a must when thinking about anything as complex as going bankrupt.
Whether you are ready to actually give it a try, or are just at the casual thinking of a Bankruptcy stage, you should consider the following facts:
1. The complexity of the Process: Bankruptcy forms are not as cut and dry as doing your own taxes. Indeed, just because you can do the one does not necessarily mean you can successfully do the other. The complex and complicated nature of the forms make them much more difficult than tax forms. The typical debtor should by all means consider hiring a bankruptcy attorney before filing their petition. Certainly, at the very least they should have a free consultation with an experienced Bankruptcy Attorney.
2. The time to complete the filing process is much longer than the average person thinks. The most common Bankruptcy Petition is a Chapter 7 which is for individuals who have very little secured assets. A secured asset is any asset that is secured by something. The most common examples of a secured asset are your home or automobile. Many consider the Chapter 7 Petition to be the least complex and simple. However, even here, the Petition process will last between four and six months. The other common Petition for individuals is the Chapter 13 Petition. This petition is for individuals who have secured assets that they want to protect such as their home or car. A Chapter 13 Petition will last anywhere from three to five years. Thus, as you can see, Bankruptcy is not an easy or short process.
3. The cost of filing a Bankruptcy Petition: The cost for filing the petition is one thing, and most would expect to pay a filing fee unless you can get it waived by the court. However, if you are like most other individuals and wish to put the Petition into the hands of an experienced professional, it will cost you. The average Bankruptcy Attorney will charge anywhere from a low of several hundred to several thousand dollars. It all depends on how complex the Petition is.
4. A Bankruptcy Petition is never private. Filing a Bankruptcy Petition opens up your most intimate financial information to the public for their examination. Included within the Petition are the famous or infamous Bankruptcy Schedules. Contained within these schedules is your complete and total financial status. Income and expenses, along with your current debts and assets are covered in detail and open for review. On top of all that disclosure, you will be required to attend a meeting with the Bankruptcy Trustee where your Petition will be questioned. The Trustee is concerned with the accuracy and truthfulness of your Petition and will ask you probing questions to explain any questions they may have. At the meeting with the Bankruptcy Trustee, your creditors are also invited to attend if they so chose.
5. You must be totally honest on your Bankruptcy Petition. Simply put, if there are any dishonest answers discovered on your petition, you will be in trouble. The Bankruptcy System is there for the honest and truthful disclosure of information. If it is discovered that the petitioner has been untruthful, the petitioner will be subject to investigation because Bankruptcy Fraud is considered a serious crime.
The Bankruptcy System is a very valuable thing for an individual to utilize when they are swamped with overwhelming debt. There is indeed life after Bankruptcy and most recover from the process and lead healthy financial lives. You can indeed regain your credit again and after the record is removed from your credit report, suffer no existing long-term effects.