Explaining the Complicated Terms of Bankruptcy
For persons who have gotten in over their head in debt, bankruptcy can offer a viable solution to get back on the road to financial health. Bankruptcy is not to be taken lightly, however. The process of undergoing bankruptcy proceedings can be complicated. And, since bankruptcy is an official legal filing, the final judgment of the court is legally binding.
Most people who file for bankruptcy do so with the assistance of a bankruptcy attorney. Having an Atlanta bankruptcy attorney on your side during a bankruptcy helps make the process less stressful and easier to deal with. However, even with the aid of a qualified bankruptcy lawyer, the complicated terms of bankruptcy can be challenging to fully grasp.
Two Types of Bankruptcy
The first step in filing for bankruptcy is to determine which kind of bankruptcy you will claim, Chapter 7 or Chapter 13. In a Chapter 7 bankruptcy, you allow the court or its trustee to oversee the sale of your assets to settle outstanding debts. A trustee is a person who is authorized to act on the authority of the court. The trustee represents your creditors’ interests. In a Chapter 13 bankruptcy, you may keep your property in exchange for agreeing to a debt repayment plan. In the debt repayment plan, you may be responsible for covering all or a partial amount of your debt.
Steps to Filing Bankruptcy
One of the steps that you will be required to complete before you file for bankruptcy is credit counseling. This short course can be undertaken alone or in a group setting. You may also be required to take a course in personal financial management. The court may, at its discretion, waive one or both of these requirements.
After you file for bankruptcy, the court usually appoints a trustee or an administrator. This will happen even if you have a bankruptcy attorney representing you. The administrator is there as a government employee to monitor all of the transactions that occur between you and your creditors. For example, the trustee may work to sell off your assets and then to disburse funds to a creditor. The administrator makes sure that the transactions are not fraudulent in any way. The administrator is working both to protect your interests and the interests of your creditors. In essence, the administrator serves in a position of oversight.
Your bankruptcy attorney is working only for your interests. The bankruptcy attorney will counsel you as far as which form of bankruptcy—if any—you should file. They will then file the bankruptcy claim for you and manage all the legal paperwork on your behalf. They will appear in court next to you and confirm that you are being treated fairly in accordance with bankruptcy laws.
Once your bankruptcy is complete, you can work to get yourself back on solid financial footing. It’s important to note that a bankruptcy will appear on your credit report for seven years. During this time, you may find it difficult to open up a bank account, get approved for rental housing or even get hired for a new job. You may still receive offers of credit in the mail, but they will be for very high interest rates. It’s crucial that you review any offers of credit very carefully, as they can get you into financial trouble all over again. After the seven years are over, the bankruptcy will be far behind you and will drop off of your credit report.
Hire Clark and Washington Bankruptcy Attorneys
When you hire a quality bankruptcy attorney for your bankruptcy needs, you will get the best representation possible. The process of filing for bankruptcy is complex. With the help of a qualified attorney, it can go a lot smoother for you. Contact us to learn more.