It’s commonly known that bankruptcy can ease the pain caused by financial misery, though not everyone fully understands how to declare bankruptcy. Having an understanding of how to declare yourself bankrupt can help you understand what to expect before, during and after you file your claim. Although there are many shady bankruptcy service companies out there that would like you to believe that there is something secret about claiming bankruptcy, the fact remains that anyone can file – even you. With that said, it’s essential that you take the time to prepare yourself for the process, as this will likely be one of the most significant events in your life.
The first step in how to claim bankruptcy involves getting qualified, which is often easier said than done. Not just everyone qualifies for bankruptcy, which is why you will be required to submit detailed information related to your assets, liabilities and household income. The bankruptcy courts will be looking for factual information that indicates that you have no means to pay back your debt, in which case you will qualify for one of two options – Chapter 7 or Chapter 13 bankruptcy. The specific type you qualify for is of great significance, as Chapter 13 in particular will allow you to retain your valuable assets. If you have a home or real property that you wish to protect, then Chapter 13 is the right choice for you. On the other hand, if you don’t have any significant non-exempt assets to protect, then Chapter 7 will be the option for you. Click on the following link for information pertaining to Chapter 7 exempt property. Chapter 7 is the most popular method of protection and allows debtors to leave behind a majority of their financial obligations. Any available non-exempt assets that you have will be used to pay back your creditors, which you would have identified during the initial information gathering stage.
Once you’ve prepared and submitted all required documentation, you will be required to attend a course or two in consumer credit counseling. You are required by law to complete these sessions, which are meant to educate you on the fundamentals of money management. Once this has been accomplished and you’ve paid your application and filing fees, the bankruptcy claim will become “live” and a will last for about 8 years. A couple of common questions related to the process are listed below –
1. How Much Does It Cost To Declare Bankruptcy? – the amount of money you pay will depend on whether you choose to seek professional assistance. Filing on your own will cost you a few hundred dollars, while hiring a bankruptcy attorney can cost between $1,000 and $2,000 in addition to the filing fees. A Bankruptcy Petition Preparer (BPP) can be hired to prepare your documents for you, which is generally the most cost effective way to go.
2. How Long Does It Take To Declare Bankruptcy? – this will depend on whether you choose to hire someone to help you. Document preparation is by far the most time consuming step, so you should look into hiring a BPP is you want to speed up the process. If you must file on your own, it’s important to take your time to ensure that the information you gather and later supply to the bankruptcy courts is accurate.
For more information on how to declare personal bankruptcy and how to go bankrupt while maintaining your sanity, please feel free to take a look around our site. The information we provide is meant to help prepare you for this important financial step.