Articles

How to Best Approach Filing For Bankruptcy

by Samantha Higgins Professional Writer

If you're facing massive debt and no way out, you may be considering filing for bankruptcy. The idea behind the process is to give municipalities, companies, and individuals the chance to start over. As well as repay their debts more quickly. However, there are some crucial factors that you should keep in mind. The following tips can help you decide if filing for bankruptcy is good for you. Here's how to approach the process in the best way.

Gather Financial Records

The bankruptcy process is complicated, and you need to take the time to gather your financial records. This will help you know the best way to proceed with filing for bankruptcy.


According to United States Courts, it's essential to keep track of everything when preparing your records for bankruptcy. You'll need to gather your receipts, credit cards, and other accounts that you own. When you prepare your financial records, you'll better understand your financial situation.


Your clients will have a hard time getting paid once you've declared bankruptcy, so be sure to keep track of everything. If you think you won't need these records, keep them anyway. You'll need them later to prove your financial strength.

Take Advantage of Credit Counseling

Federal law requires you to complete a credit counseling session before filing for bankruptcy. It can be conducted over the phone, online, or in person. The counseling agency will ask you to provide a case number, and you don't have to pay the fee unless you're unable to afford it.


This educational course teaches you about debt management and gives you the skills to pay your bills. The sessions generally last an hour, and they can be conducted in person, over the phone, or online.


While filing for bankruptcy can be costly, credit counseling has many advantages. The course will help you understand bankruptcy basics and prepare you for post-bankruptcy life after the filing. By getting help early, you can avoid a lot of heartaches later. This is why it is crucial to take the time to do it.


Submit the Petition

To file a petition in bankruptcy court, a debtor must fill out several forms. This includes a form that details the debtor's financial circumstances. This can be done with the assistance of a bankruptcy lawyer. The petition must be signed under penalty of perjury. If you are filing on behalf of a business, you must include an official representative and a self-addressed envelope.


The court will review the debtor's conduct when determining whether they can afford to pay back their debts. Aside from their payment history, they will also consider if the debtor owns any assets, such as cars. This information is vital for a successful petition, so gather all the information you can before filing.


If you can pay them off with your assets, the court will discharge the debt. If not, the court will dismiss your case. This way, the court will know that you're serious about addressing your financial problems.


Once decided, the court will enter an order for relief. This will prevent the creditor from moving forward with repossession. Or any other adverse actions until the court receives your petition. As a result, it's critical to prepare your petition well ahead of time.

Consult with Your Creditors

Before you file for bankruptcy, you should consult with your creditors. It will help if you keep your correspondence to a minimum. You should not give your creditors any personal information, as it can be used against you later. This includes not answering any phone calls from creditors.


It is best to speak with your bankruptcy attorney and make the conversation confidential. You should never disclose the reason why you are filing for bankruptcy. The most important thing to remember is that your debtors need to understand that you’re filing for bankruptcy does not mean the end of your relationship with them.

Conclusion

After filing, gather your business' documents. These will include tax returns, bank statements, and other vital documents. Once you've filed for bankruptcy, your clerk will review them and scan them into an online system. The processing time will be less than 15 minutes. It is prudent to consult an attorney and complete your bankruptcy petition. Your bankruptcy attorney will represent you during the case, so it's essential to be as organized as possible.



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About Samantha Higgins Innovator   Professional Writer

5 connections, 0 recommendations, 92 honor points.
Joined APSense since, June 29th, 2020, From Portland, United States.

Created on Dec 23rd 2021 13:55. Viewed 261 times.

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