subject: Bankruptcy 101 [print this page] Finding yourself in a challenging financial predicament can be stressful. Facing the potential of dealing with bankruptcy can be even more stressful.
Because most people in serious debt are ashamed of their dilemma, they don't ask questions regarding the bankruptcy process.
Filing for bankruptcy is one of the biggest financial decisions a business or individual will ever make, it is vital to have accurate bankruptcy information before initiating the process.
The United States federal court system manages all bankruptcy information and establishes the laws regarding the procedure.
Simply by filing a petition referred to as a Statement of Intentions, this is how the you tells the court system that they are applying for bankruptcy.
Just because a person files the Statement of Intentions does not always mean they will complete the process. The courts will request credit history, creditors and the amounts of all debts, along with current and past work history. This information will be studied to establish whether or not a debtor can proceed with the court case.
You are not required hire an attorney to represent you in proceedings. However, an attorney can be a terrific source of knowledge concerning bankruptcy information.
Most people are afraid to take on an attorney because they do not realize that they can really afford to do so. The truth is a number of bankruptcy attorneys are reasonably priced due to the circumstances.
One of the main misconceptions of bankruptcy is that all possessions are taken and repossessed. Only Chapter 7 requires a complete liquidation of assets. However even with Chapter 7, people are allotted exempts, or items that are necessary for living.
There is a new bankruptcy law in place referred to as Bankruptcy Abuse Prevention and Consumer Protection Act. This law was enforced in 2005 to prevent fraudulent bankruptcy claims.
Though filing for Chapter 13 and Chapter 11, have not changed that much, filing for Chapter 7 has becoming ever more difficult.
