The bankruptcy attorney can seem like a confidante when you first meet him or her, because you will be sharing your personal financial details. Normally, these kinds of details are the kind people try to hide from the world for as long as possible. But when the debt burden becomes unbearable, it’s good to have a professional on your side as you deal with the complexities of the bankruptcy laws.
The very first decision an attorney will help you make is whether you should file bankruptcy at all. In some situations, other remedies are possible including selling assets or downgrading your lifestyle. But when that’s not possible, the second decision the attorney will help you make is deciding which bankruptcy chapter best fits your situation. The personal bankruptcy chapters are 7 and 13. Under chapter 7 you wipe out most debt. Under chapter 13 you set up a debt repayment plan through the court.
Once your bankruptcy attorney and you decide that filing is the right course of action, the next step is to actually record the petition in court. Your attorney will take care of this step and all other legal filing requirements. But after the filing you will discover an attorney specializing in bankruptcies can offer a number of other services.
The bankruptcy attorney is prepared to handle any and all special issues that arise during the bankruptcy process. For example, if you owe the Internal Revenue Service there are specific forms which must be filed in order to request IRS approval of tax debt elimination. The IRS will respond by indicating which debts can be included in the bankruptcy. Other special issues include business related debts, medical bills and the state and local debt laws that must be balanced with federal laws.
When you file a bankruptcy, it also helps to have an attorney that is trusted by the courts. Experience counts in court and a recognized and knowledgeable attorney is able to handle any court requirements. When you file bankruptcy, the court appoints a trustee to represent the court. The trustee reviews the attorney’s filings and can ask any questions that he or she sees fit to ask about your financial status. Your bankruptcy attorney can guide you through the process.
Your bankruptcy attorney also deals with creditors once the bankruptcy is filed. You virtually have no more contact with debt collectors and all debt collection efforts are referred to your attorney. This alone is a valuable service, because the attorney understands laws related to debt collection and is not cowed by collection efforts.
Even after you have completed your bankruptcy, the attorney who is an expert in bankruptcies can guide you on ways to re-establish your credit. This advice is valuable, because a bankruptcy stays on your credit record for 10 years. Therefore, establishing good credit is important, because your life will not be on hold for 10 long years.
A bankruptcy attorney is a person who will guide you through the entire bankruptcy process from initial financial status review to generating new credit after the bankruptcy is completed. If you are considering filing bankruptcy then your very first call should be to a bankruptcy attorney.
In many cases, it is possible to avoid bankruptcy with some major financial planning and whole new attitude towards your standard of living. In other words, you can avoid bankruptcy if you make plans to do so and then stick with those plans. There are plenty of reasons why you would want to take this approach if there is a way to avoid bankruptcy. Bankruptcy is life changing for many years and can make it more difficult to do certain things for up to 10 years including getting credit you need.
Avoiding bankruptcy is not something you can do in a haphazard manner. It requires a serious evaluation of your current financial status, a desire to reduce your debt and a determination to do whatever it takes. Your plans will require some sacrifices and belt tightening, but the rewards can far outweigh the effort required to avoid bankruptcy. Some people attempt to make these life changes on their own, but a bankruptcy attorney can assist you in many ways you may be unaware are possible.
The reason you are feeling as if you are near bankruptcy is because you have too much debt compared to your income. To reverse the process you will have to reduce your debt and maybe increase your income temporarily. Some people get a part-time job for a while in order to earn extra money to pay off debt. But there are many other steps you will need to take which either lower your debt or create revenue in order to pay off debt.
When you meet with a bankruptcy attorney, the first thing you do is complete a financial evaluation form. Sometimes, the attorney will see ways you can restructure your personal finances in order to avoid bankruptcy. For example, you can sell some assets that are not critical to your day-to-day life. These assets may be any of your personal property.
In some cases, you will be advised to sell your home in order to eliminate a large mortgage payment. You can then take the equity and purchase a smaller house or one with a lower payment. You can also use the equity to pay off debt even if it means renting for a while. Obviously, you need to reduce your spending however it is possible. If you have a lot of unsecured debt, it is often possible to negotiate with the credit card companies to get lower interest rates so you are able to actually make progress towards paying off the balances.
A bankruptcy attorney can assist you with negotiating with your creditors. For example, if you have loans it might be possible to restructure them in order to lower the payments. This is true for your car payment also. In other words, your attorney and you will go through each debt determine if there is a way to get your payments in line with your income.
One of the most important steps you will take though is to establish a budget and then develop the discipline to stick with the financial plan. It may hurt to sell some of your assets, but if you are able to avoid bankruptcy the rewards are immeasurable.
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