If you are thinking about filing bankruptcy, it is important to do your research first. While bankruptcy offers a way to start over again, the government has passed laws regarding who is eligible to file each type of bankruptcy and the requirements you must meet before filing your bankruptcy petition. A bankruptcy lawyer can explain how to file for bankruptcy and help you properly complete the required paperwork to help your case.
Before you can even file for bankruptcy, you must first complete a credit counseling course within six months of your filing date. Your course may be taken in-person, online, or even over the phone, but it must be conducted by a court-approved agency. After you have successfully completed the course, you will receive a certificate to file with your bankruptcy petition.
Before filing bankruptcy, you must be a resident in the state where you will submit your petition for at least 90 days. You should also begin gathering all of your financial documents, which may include your pay stubs, tax forms, and vehicle titles. A lawyer can help you create a document listing your assets, debts, and monthly budget.
There are four different types of bankruptcy: Chapter 7, Chapter 11, Chapter 12, and Chapter 13. If you are interested in filing Chapter 7, which liquidates all of your debts, you will have to pass a means test. This test compares your current income to the median income in your state and reviews your disposable income and unsecured debts. If your income is above the median household in your area, you may still be eligible to file Chapter 13 in order to reorganize your debts.
If your petition to file bankruptcy is approved, the court will schedule a meeting with your creditors. A court-appointed will review your financial documents at this meeting and either help you liquidate your assets or create a repayment plan.
Filing for bankruptcy can be a complicated process, and it is important that it is done right the first time in order to avoid foreclosure or repossession of your property. A bankruptcy lawyer can guide you through this process and act as your advocate.