Bankruptcy is an option a person has to discharge the debt that they cannot pay off anymore. Bankruptcy should always be the last option after trying several different things to pay off your debt. The reason why it should be the last thing you do is because it will hit your credit report very hard. It will be a public record that will stay there for ten years. You really need to be sure that bankruptcy is the last thing available for to get rid of the debt that you owe.
The first thing you need to do when you decide to file for bankruptcy is to seek some outside help. Meet with a credit counselor to analyze your options and financial options responsibly. Your counselor might be able to offer you some options that you have yet to think about. Many creditors will work with you and offer you a reasonable payment plan for your debt if need be. Some examples of credit counseling agencies you could contact are The National Foundation of Credit Counseling, The Consumer Credit Counseling Service, or The Consolidated Credit Counseling Service. All three of these debt management companies will give you the best options to resolve your outstanding debt.
When the bankruptcy is the last and only option to get rid of that debt, it is very important to get good legal advice. Bankruptcy is actually filed through the court so having the right lawyers on your side is a very important aspect when filing for bankruptcy. You can do a simple search through the internet to help you find the right bankruptcy legal firms to help you. They will help you present your papers correctly so your case wont be dismissed if something is filled out wrong. It is also very important for you to know about the bankruptcy process when doing this. Since October of 2005, the bankruptcy law changed and now not everybody can file for the same type of bankruptcy.
There are two types of personal bankruptcy. There is a Chapter 11 bankruptcy as well as a Chapter 13 bankruptcy. The Chapter 7 bankruptcy includes the debt and you can get rid of 100% of the amount that you owe to your creditors. This means you will not be legally responsible to pay this debt once it is discharged by the court. If you don’t qualify for Chapter 7, you may be qualified for Chapter 13. Chapter 13 works out a repayment plan through the courts. This could last between three and five years. When you pay off the payment plan through the court, they will then discharge the remainder of your debt. For somebody in these situations, it is very important to know what bankruptcies will be available for you if the situation is need be. Lastly, it is important to hire bankruptcy lawyers san diego to help you out with filing bankruptcy and in dealing with all of these legal systems. It will be easier for you if you have a professional who will help you and support you all throughout the process.