Filing for Banrupcy – Know your legal rights
Filing for bankruptcy: Know your legal rights
Keywords: Bankruptcy lawyer(s), Bankruptcy law firm(s), Bankruptcy attorney(s)
This is not a legal advice. You must seek a licensed lawyer or law firm for proper advice.
Bankruptcy is not a phase where anyone wants to be in. It is dreaded by everyone alike. However, you need to know everything about bankruptcy. In case God forbid you have to file for bankruptcy in future, you should know your legal rights.
This article will inform you everything you need to know about filing bankruptcy, no matter if you are already bankrupt or not. So, let us get started and learn a lot of things about bankruptcy, such as what it is and how you can file for it.
What is bankruptcy?
Bankruptcy enables businesses, individuals, as well as couples that cannot meet their financial duties to be excused from paying off all or a part of their debt(s). The origin of bankruptcy is quite old. Every country has its own bankruptcy rules and policies. Likewise, in the United States, the procedures and rules for filing bankruptcy are supervised by federal law, and not state law. A bankruptcy lawyer can help you understand the rules of bankruptcy in a better way.
Types of bankruptcy
In general, there are two different types of bankruptcy. One is liquidation bankruptcy. In this type of bankruptcy, debtors have to surrender their property that is later sold and the proceeds from the sale are distributed amongst the creditors. In exchange of this, all the debts of the bankrupt person are permanently set free.
The other type of bankruptcy is the reorganization bankruptcy. In this, debtors can keep their property, but they have to settle on an installment plan in order to repay the creditors a part of their outstanding debt.
How to file for bankruptcy
When filing for bankruptcy, you must know your legal rights. To be in a better stance, take help from a bankruptcy law firm that can help you manage your bankruptcy. Nonetheless, when you file for a bankruptcy, you must be aware that you need to submit a petition along with a fee in the respective bankruptcy court. The bankruptcy fee is around $300 for most of the cases.
The bankruptcy petition entails sworn statements signed by the debtors. These statements are regarding the owed money, the expenses, the income, as well as the list of assets of the debtors. After you file for bankruptcy, which you should do with the help of a bankruptcy attorney, a court hearing will take place, so that the information provided in the petition can be reviewed.
How can you avoid bankruptcy?
Although, bankruptcy means you are in a position where you cannot pay off your debts, it is a personal choice to declare bankruptcy. However, there are many ways in which you can avoid bankruptcy. You must be aware that you cannot fake bankruptcy, since you have to show a list of your assets, income, and expenses in the court hearing.
Certainly, taking help from a bankruptcy lawyer will help you, no matter why you have filed for it in the first place, whether due to unemployment, calamitous medical expenses, overextended credit, marital problems, lack of insurance, extravagant spending, etc. In order to avoid filing for bankruptcy, you can follow some of the below mentioned strategies in your everyday life.
• If you have debts piled up and you are unable to pay them, then you should look for ways to earn more money. You can even ask your family members to give their contributions in paying for the debt(s).
• Maintain a budget and stick to it. Track your spending and minimize your expenses and daily bills, so that you do not spend more than you earn.
• You should start saving if you have debts. Spending all of your income is a bad habit. In fact, you should save most of your earnings.
• Do not use your credit cards. You can close them, hide them, or just ‘freeze’ them in order to avoid using them. Instead, make use of your debit card or cash to pay for your requirements.
Do you need a bankruptcy attorney?
Well, most of the debtors who are close to becoming bankrupt or have already become bankrupt ask this question, that is, do they really need a bankruptcy law firm or bankruptcy lawyer to help them out? The answer to this is a big yes. You must definitely take help from a bankruptcy law firm. In fact, according to the U.S. Bankruptcy Court, it is quite difficult to file a bankruptcy case without a bankruptcy attorney.
With professional advice, you can know your legal rights and file for bankruptcy in the best way possible. Your creditors too will be represented by their lawyers and they will have an upper hand with expert advice on their side.
Even if you decide to file for bankruptcy on your own, you should at least consult with a bankruptcy lawyer. Check out JurisOffice to get in touch with the best bankruptcy law firms and bankruptcy attorneys in your locality.