Bankruptcy is a procedure through legal means that allows people who are lost in debts to start all over again financially. When a person is declared bankrupt or is bankrupt, it is advisable to claim bankruptcy through the set rules and regulations. However, precaution should be taken before claiming bankruptcy since not all situations call for the claim and once you declare and claim your situation, it stays in your credit report for a long time which could be damaging.
The very first thing you should do when the need to claim bankruptcy arises is to get a good lawyer. The lawyer is responsible for advising you on the path to take and educating you on which bankruptcy best suits your situation. He is also the one who will find a good rate for your file and take care of the proceedings.
After choosing the right file for your case, you then need to get enough funds to pay your attorney as well as the court fees. This could be a bit costly; hence the reason why you should be absolutely sure that the claim is necessary. It is good to remember that the case could turn against you, especially in cases where the court feels you can comfortably pay your debts depending on your income. You and your lawyer should then come up with a list of all your liabilities and assets. If you run a business, you will be required to include all your business affairs before the list is given to the court together with your paperwork.
A petition is then filed with the bankruptcy court and the court’s decision on your case is awaited. The waiting period differs from place to place with some taking as long as 6 weeks so you should be prepared. When you claim bankruptcy, your creditors will be stopped from collecting their debts from you till the court decides the next way forward. This is a great way of helping you rebuild your financial life.
Although a bankruptcy claim could ruin your credit report, it is much better than having to face the embarrassment that comes with letters, calls as well as lawsuits and harassing calls from your creditors. It is a way of helping debtors start all over again by repaying what they can manage when they can manage.
