There’s nothing quite as scary as the unknown, and that is as true of the bankruptcy filing process as of anything else. That’s one of the reasons that it’s smart for anybody considering filing for bankruptcy to consult with an experienced bankruptcy attorney who can explain what is involved and provide invaluable guidance.

The good news about bankruptcy is that it is a highly formulaic process. There are steps that need to be followed, and they are entirely predictable. The downside is that they require significant attention to detail, and if you miss a step or make a mistake while preparing the many documents that are required, it could end up costing you more money or taking you more time. Here are the basics.

• Choose between Chapter 7 and Chapter 13 for your bankruptcy filing. Chapter 7 is usually a better choice for people who want to discharge all of their debts and not be responsible for any of them. Though you may have to sell off some assets, many of the things that are most important to you – like your house or car – may be exempt. Chapter 13 lets you keep more of your things but you end up continuing to pay for most of your debts under a new payment plan, over time.
• Take a credit counseling course. This is required before you can actually file for bankruptcy, and can be done online. The cost of the class is minimal, but you will need a certificate to show that you have completed the course.
• Collect all appropriate documents, including bills and papers that demonstrate your debts as well as your assets.
• Fill out all of the required bankruptcy forms and file them according to the rules posted on the bankruptcy court’s website.
• As soon as the paperwork is filed there will be an automatic junction to stop creditors from any further collection activities.
• Meet with the bankruptcy trustee to discuss the sale of any non-exempt assets. The trustee will use the proceeds of those sales to satisfy debts.
• Allow time for creditors to object to the bankruptcy filing.
• Take a course on financial management. This class can be taken online.
• Debts are discharged, with the exception of child support, alimony, some taxes and student loan debt. These are not dischargeable.

This quick summary just scratches the surface of the bankruptcy process. For more information, contact us today to set up a time to discuss your situation.