subject: Things to remember before filing for Chapter 7 Bankruptcy [print this page] Chapter 7 Bankruptcy seems to be a handy and known option to debtors who are neck deep in debts and thus they do not spend much time to re-consider their decision. Practically one should consider the available options and alternatives before deciding upon Chapter 7 bankruptcy, as the after-effects of this plan are not very pleasant apart from leaving marks on the credit score for years. In case of unsecured debts like credit card, personal loan, judgments and medical bills, chapter 7 helps in eliminating them, however one should find out more about the options of debt settlement and debt consolidation if bankruptcy can be avoided in certain situations. A financial counselor or an efficient debt lawyer can always give helpful suggestions regarding dealing with debts. Chapter 7 aims at removing your debts, by retaining your personal belongings and thus it works accordingly.
Generally your property can be kept by you, but your car and mortgage payment has to be paid by you currently. Also if the court finds that your current property has significant amount of equity, it may ask you to leverage the same in order to pay your debts first. The debtor has to keep the following things in mind before filing for Chapter 7:
1. To avoid creditors' harassment, you should hire a Chapter 7 attorney immediately who will provide you with a record number. The debtor then gives this record number to his creditors who can then be referred to the debtor's lawyer.
2. A good lawyer will always ensure that you retain your personal belongings like your house. Typically the lawyer ensures, that your other vital assets like Car and vehicles are also safe and protected. But as a filer,you too should be aware and pro-active about the proceedings and laws.
3. Your bankruptcy is a public record, but practically no one would have any notifications about the same except you, the bankruptcy court, IRS and your creditors. Your employer or other outsiders cannot be informed about it.
4. Before going for a debt lawyer, make sure to do a background check about his professional certificates and affiliations,his experience and expertise and work load.He got to have natural sincerity and compassion towards his client.
5. Chapter 7 Bankruptcy affects your credit score for almost 10 years and this somewhat brings negative impact on your credit score.Creditors generally do not lend or lend at high interest rates to a debtor of this plan.But it always paves a new and fresh way to rebuild your credit history. But remember that creditors are in a business to lend you money, and thus there are many who would sell their money at this situation.
6. Once you file for bankruptcy, you can repeat the filing before 6 years from the time you are discharged by the court.You should by then learn the value of money by managing your income and expenditures, so that you don't find yourself in the same position again.
Keeping this basic information in mind always help the debtor to take the most suitable and wise decision regarding Bankruptcy ch 7. Thus,always keep your senses at place and let your presence of mind' rule and win for you.
Things to remember before filing for Chapter 7 Bankruptcy
