Today I want to offer some advice on personal bankruptcy. Declaring personal bankruptcy should not be scary and put the fear of God in you. Although personal bankruptcy is a serious financial undertaking that can affect you for years to come, and it shouldn’t be taken into lightly, the current economic situation dictates that it is becoming a much needed option to give many folks a clean start. Although most folks are familiar with Chapter 7 personal bankruptcy and Chapter 13 personal bankruptcy at least as it pertains to the United States, there are in fact 6 chapters of bankruptcy under the Bankruptcy code. However, as far as individuals are concerned and especially consumers, personal bankruptcy is limited to mostly Chapter 7 and Chapter 13.
If you are considering personal bankruptcy you will most likely need to undergo personal bankruptcy pre-counselling where the merits of your case are discussed with a personal bankruptcy attorney, like a California bankruptcy attorney if you’re in California or a New York bankruptcy lawyer if you’re in the Big Apple. However, you should see the personal bankruptcy lawyer that is in your city, because even though bankruptcy law if Federal, your local lawyer has succes with the local courts and understand their nuances better.
Most times, I would suggest that bankruptcy is good for most individuals who partake of this option. But do not be fooled, there are consequences to filing personal bankruptcy. And if you are interested in how to file personal bankruptcy or how to declare personal bankruptcy, you would be best informed by seeking the guidance of a lawyer who specializes in personal bankruptcy.
Here is how declaring personal bankruptcy works. In Chapter 7 bankruptcy you give up the rights to most of our extraneous property. There is some allowance for personal possessions that are deemed necessary, such as clothes, an older car, work related tools etc, and these vary from State to State. But with Chapter 7, all of your debts are eradicated and you are in essence given a fresh start. However, child care and other obligations or falsified records are exempted. For more personal bankruptcy information on these exemptions you’d do well to talk with a personal bankruptcy specialist.
Chapter 13 bankruptcy is basically a payment plan where you get to retain the disputed property so long as you agree to a payment plan that lasts anywhere from 3 to 5 years and you maintain your payments. Again, an experienced personal bankruptcy attorney will be able to guide you into the correct personal bankruptcy approach for you. However, it is important to remember that personal bankruptcy follows you for 8 years and you can only declare personal bankruptcy once every 8 years. Personally, I’m not sure why anyone would need to declare personal bankruptcy more than 2 or 3 times in a lifetime. And remember than filing for personal bankruptcy will affect your credit score and ability to obtain loans for those 8 years too.