Filing for Chapter 7 Bankruptcy | Guest Law Blog | YouBlawg

If you can?t handle the surmounting interest of your debts and it seems the world is toppling down around you, bankruptcy is left as an option. There are several types of bankruptcy you may check out. Each has its own criteria, requirements, and other documents necessary for filing. Why would you need to review the best type of bankruptcy? Courts may dismiss the bankruptcy if you have filed a previous one and you are just using the court to cheat creditors. If you are in great mire of financial bankruptcy, you have to find out the best option to regain your financial freedom and avoid filing another one in the near future.

Of course, your bankruptcy attorney can tell you the requisites of each type of bankruptcy. With the Chapter 7 Bankruptcy you can be discharged of all your debts, after meeting certain requirements. Actually, there is no clear latitude on the criteria of Chapter 7 bankruptcy, but it is the judgment of the court on how well can your income pay the current debts you have. It must be that your capacity to pay the debt, with its interest and other attached fees, is already exhausted. You cannot pay the debt, period.

The current measurement used to determine the capability to pay debts is the average monthly income of the person against the median income of the state. If the average income is less than or just equal to the median of the state income, the person is eligible to file the Chapter 7 Bankruptcy. The court gives higher priority to disabled veterans who have been injured during active duty. Bankruptcy that is due to operation of business may also be given leeway in most courts. If you still know if you are eligible for the Chapter 7 Bankruptcy, it is good to ask a bankruptcy attorney to calculate your capability to repay debts in a five-year period after all living expenses are deducted.

Now that you have determined your eligibility of the Chapter 7 bankruptcy, you need to get a financial and bankruptcy counseling. The problem with most filers is they miss the counseling session. The court will dismiss the bankruptcy appeal if you don?t have a counseling session with accredited counselors.

There are documents you need to file along with the petition for bankruptcy. Of course, you need to prepare financial statements to show incapacity to pay debts, including schedule of assets and liabilities, current cash inflow and outflow, and liabilities or debts included in the petition. Moreover, you must not forget to prepare documents to support leases, contracts, notes, and such others. A means test must also be complied, which will be used by the bankruptcy trustee when evidence of bankruptcy abuse was made in malice.

So why do you need to find a bankruptcy lawyer to help you file the bankruptcy petition at the soonest time when things go south? When the petition has been filed to proper courts in your area or where the business is located, creditors are not allowed to garnish or demand repayment. In filing the petition, you have to bring necessary documents as already mentioned above. Don?t go to the court if you don?t have these documents.

After filing, you wait 20 to 40 days for the scheduled creditors meeting. Creditors will ask you on matters regarding your capability to pay, your properties and other assets which they believe you have included in the debt contract. Don?t worry; most credit companies don?t send representatives to these meetings.

If things go the right way, your debts will be discharged and you can begin a new life. Regain what you have lost.

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Source: http://www.youblawg.com/banking-and-finance-law/filing-for-chapter-7-bankruptcy

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