Bankruptcy can be a very difficult and stressful process to go through alone. Every state will vary when it comes to their specific bankruptcy laws and how you file for it. To answer the question of if one has to go to court if they file bankruptcy, the easy answer is yes. First, let us take a look at what exactly bankruptcy is and the various types an individual can file for.
Types of Bankruptcy an Individual can File for
According to Experian, bankruptcy is the legal process put in place by the federal bankruptcy courts to assist individuals and companies eliminate part or all of their debt. Now with that said, it can help you or your loved ones get relief from all the debt you may have, but it will also have an effect on your long term credit. When one declares bankruptcy, it will stay on that persons credit report anywhere from seven to ten years and this can have an impact on what types of loans you can be approved for and your ability to obtain certain credit card accounts. Now, let us discuss the types of bankruptcy an individual can file for, we will start with what is called Chapter 7.
Chapter 7 Bankruptcy
This type of bankruptcy is what most people think of when considering taking the bankruptcy route. When declaring chapter 7, you must allow a court trustee to overlook the sale of any possessions or assets that will not be considered exempt. These could be work related assets, vehicles, and possibly even household type items like furnishings etc. After the sale has been made, the money from it will then go to the credits in an attempt to pay off some of the balance one owes. After that, what is left will then be eliminated from the debt owed. This type of bankruptcy will not allow you to get out of all kinds of debt, such as: child support, court ordered alimonies, federal and state taxes, and student loans. If an individual files for chapter 7, they will not be able to file for it again for eight years.
Chapter 13 Bankruptcy
This type of bankruptcy differs from chapter 7, when filing for chapter 13 it will allow a person to keep their property in exchange for repaying your debt either partially or completely. The process will start with your attorney and the court negotiating a three to five year plan for repayment. Once this plan is implemented and you have paid either the full or partial amount that was negotiated, the rest will then be discharged. After 7 years from filing this type of bankruptcy will fall off ones credit report, and they can file for chapter 13 again within 2 years which differs greatly from the chapter 7 refile length.
So, we know the two types of bankruptcies a person can file for, now let us look at what is needed to file for them.
What Needs to be Done Before Filing Bankruptcy
When one is considering bankruptcy there are some steps and documents needed before doing so. These are but not limited to:
- Gathering any and all financial paperwork
- Figuring out how much of ones property will be exempt
- Complete the pre-filing mandatory paperwork for credit counseling
- Complete the 50+ forms and pages acknowledging one’s debts, income, assets and expenses
- Assemble these forms and make copies for the given local courts rules
- File the forms with that said court
- Pay the filing fee
- Meet with the creditors and the court trustee
- Motion to remove liens
- Complete the mandatory financial management course
As you can see, filing for any type of bankruptcy can be a daunting task. If you are considering bankruptcy in Ohio, you should contact an affordable Xenia bankruptcy attorney to see how they can help, visit here for more information.
The length of time it takes for bankruptcy in Ohio can range from a few weeks to a few years depending on how much debt was owed and what type of bankruptcy one is filing for. A bankruptcy attorney can help you through these steps to ensure you get it right. With that said, let us look at how exactly a bankruptcy attorney can help.
How an Attorney can Help when Filing for Bankruptcy
An individual can end up spending more over time if they believe they can file for bankruptcy alone. A bankruptcy attorney can help save money because they will make sure you don’t pay any unnecessary costs and make sure you are aware of any unexpected costs as well. Some mistakes a person can make when filing for chapter 7 may be:
- Income listed does not align according to their income documents
- Using the wrong size for one’s household
- Trying to take deductions that will not be allowed
- Not taking certain deductions that one is able to
- Child support was listed that is supposed to have been paid but it is not
- Claiming payments on a mortgage that one has not paid in the past six months leading up to the filing
These are just a few of the common mistakes a person can make, a bankruptcy attorney will ensure these mistakes are not made and the paperwork is filed correctly. Make sure to work with an experienced bankruptcy lawyer such as David Braun Law if you are in a difficult situation.
An attorney will also make sure the process is successful. As you can already see the process of filing bankruptcy is very intricate and complex, an attorney can help you get through each step and make sure you are not doing anything that can be what the courts consider as fraudulent. They will also give you great legal advice on what types of bankruptcy is available for your situation and help you get your financial life back to normal.
They will also help you make sure everything is filed correctly throughout the repayment process and ensure your fees that were agreed on are paid according to the negotiations. They will represent you in court and file motions for eliminating various liens and objections from the creditors. The process as you can see is not so easily managed alone, contacting a bankruptcy attorney to help you through it would be a wise decision as it can save you money in the end. Contact a local bankruptcy attorney today so they can evaluate your case and finances to ensure you get back on the path of financial freedom as stress free as possible.