What to Know Before Filing For Bankruptcy – Part 2

Lets continue on in our series on what to know before you file for bankruptcy!

Bankruptcy filings are public documents

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Because the paperwork from your bankruptcy case is public, anyone who wants to look up your current or past financial situation is able to. The names of those who file are posted both online and in newspapers, so you will loose some control on your financial privacy.

Filling for bankruptcy comes with specific requirements
The court judge will decide what creditors you pay back and when. You may be forced to relinquish rights on all your credit cards, and may have a lawyer imposed rule on what you can and cannot spend money on.

It costs money
There are many costs that come when you file for bankruptcy. You have lawyer and paralegal fees, court filing fees, and paperwork fees. Typically, the fee for filing chapter 7 bankruptcy in the United States is around $306.

You should also be wary of bankruptcy attorneys advertising very low fees, as you want a quality lawyer with experience to help you navigate court. As strange as it may sound, filing for bankruptcy is not the time to scrimp on money!

Your creditors may disagree
It is important to know that just because you file for bankruptcy it does not mean your creditors will agree with you. There will be a meeting of the creditors, and the creditors have the right to deny your request to liquidate the debt owed to them.

Chapter 7 is more popular than Chapter 13
Chapter 7, the liquidizing of assets method, has proven to be more popular than any other method. In 2013, there was a total of 728,833 Chapter 7 bankruptcies filed, compared to 333,626 Chapter 13 bankruptcies.

This won’t fix everything
As much as you wish that filing for bankruptcy will fix all of your financial problems, it will not. After the process is over, it is important to recognize how you got to that situation and how to ensure you never have to return.

If you are filing for bankruptcy or have any other questions about how the process works, do not hesitate to contact the Law Office of Charles Huber today.