We have all been there. There is just not enough coming in to cover what is going out. The reasons vary. Perhaps you or a family member have/has significant medical bills as a result of a serious illness or sudden accident. Perhaps your job or career has unexpectedly come to an end AFTER you have obligated yourself to numerous financial commitments. Perhaps your credit cards and the interest rates have just gotten out of hand. You are receiving phone calls and mail from creditors attempting to get money from you that you just do not have.
The Federal Government knows that the above life-changing events occur, and, in conjunctions with the states, has provided relief, a way out, to those who choose to take advantage of their plan. Simply put, bankruptcy means you are asking the Court to excuse you from your duty to repay debts. You can get rid of some of your debts (Chapter 7) or reorganize most of your debts (Chapter 13) while keeping some of your property. You can file separately, or jointly with your spouse. A business can file to reorganize, as well (Chapter 11). As soon as you file, an automatic stay goes into effect that bars creditors from harassing you. It is important to file prior to any creditor receiving a judgment against you.
In a simple Chapter 7, some debts can be discharged (forgiven), such as credit cards and medical bills. In many situations, you will be permitted to keep property such as your home, retirement account and vehicle(s). Each state has its own list of exemptions for property that you will be permitted to keep. Some debts cannot be discharged, such as child support, taxes and school loans.
Once you file, you will attend a meeting of creditors, and then the Bankruptcy Court will consider your Petition. Soon after you receive your discharge, your credit score will begin to rise. Simple as that!
Call today for a free consultation to determine which type of bankruptcy is right for your circumstances!