If you’re looking to file personal bankruptcy but don’t know the first thing about getting started, try not to become overwhelmed. The personal bankruptcy process can be an effective way to rid yourself of accumulated debt, though it’s important to understand that debt elimination through bankruptcy doesn’t come without its consequences. Not only will your credit rating suffer immensely if your claim is approved, but you will be forced to spend hours researching and filing paperwork just to get your claim processed. The process is even worse for those that choose to file a bankruptcy claim on their own.
Before choosing bankruptcy as a debt elimination strategy, it’s important to understand what goes into the process and what to expect before during and after your claim. Most people don’t realize that filing for bankruptcy requires approval, which is based on your financial history and current household income. In order to be approved, you will need to gather detailed information related to your debts and assets. In addition to using this information to qualify you, the bankruptcy courts will also communicate any assets you have to your creditors, who can then pursue them in court.
Under the most common type of personal bankruptcy, Chapter 7, any non-exempt assets that you own will be liquidated to pay back your creditors. Once this process has occurred and all of your assets have been liquidated, any remaining debt will be forgiven. A notation will be placed on your credit rating stating that you have gone through the bankruptcy process and this notation will remain on your credit report for 10 years from the date of filing.
Because of the sheer amount of work involved in filing a claim, it’s recommended that you seek professional assistance instead of filing on your own. A bankruptcy attorney can provide legal advice and representation and can also complete all of the necessary paperwork that’s involved with filing. For more information on how to claim bankruptcy, consider setting up an initial consultation with an attorney or bankruptcy assistance agency.