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Essential Things You Should Know About Filing for Bankruptcy

Although in most cases getting some loan is an easy task once you meet all the requirements, paying back the debt may be a big problem to some. One area of concern once you realize you are bot able to settle all the debts is the next step that is best for you. Even though bankruptcy is never a nice topic for most business and people, it is already with us and the best we can do is to enlighten you on the right step to take should you be a victim. It is important to note that bankruptcy is a legal process and it involves the debtor and the lender in case of the debtor gas no capacity to pay back all the loans.

One of the most basic thing that you need to know about is the process and whatever happens in court. The whole process of decision-making in court is made through a judge and an independent contractor who is hired for the case. The decision on whether you are eligible for bankruptcy is made after both the judge and the trustee have reviewed information to declare you bankrupt or not.

You will also get to learn that there are very many types of bankruptcy and you can view here to know more about it. Among the various types of bankruptcy is chapter 11, chapter 12 and chapter 13 whereas chapter 7 is the most common one. You should also know that chapter 12 is occupation-based occupation-based as explained on this page. Although chapter 7 bankruptcy may forgive most of the debts, you may have to sell some of the important bassets that you own to pay the debt.

As a debtor, it is important to know that this process is very long as well as expensive. You should always seek to meet the credit counselor for bankruptcy and debt and at the same time assemble all the information that may be necessary for you. You should also be at the frontline to show the court that you have made the best effort you could in an attempt to fix the situation.

Your financial situation is the next greatest tool for the court before a decision is made. The key participants in looking at your financial statements are the lawyer, the trustee and the creditor. You need to note that this process lasts for a long time and can take up to 6 months The tips above should give you a clue about what to expect when filing for bankruptcy.

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