How Does Bankruptcy Help?

Many of the options to bankruptcy, such as renegotiating with creditors individually or trying to get into a debt repayment plan or contracting with a company that will supposedly negotiate your debts down all play on the fear of filing bankruptcy and the stigma that supposedly attaches to it. The truth of the matter is, there is nothing that can do what bankruptcy does; it’s a great thing that the Constitution contains such a provision, even if many people use it and refuse to talk about it.

That’s right; you may not even realize how many people you know have probably filed for bankruptcy; if you are stuck under a pile of debts and it’s ruining your life, you should realize it’s your right to file bankruptcy and take care of that; it’s part of the world of business and finance, and everyone calculates for it. You shouldn’t feel bad about using that right to get yourself back on your feet and get your life back together. While it’s not for everyone, bankruptcy really is the only way to clear out a massive financial problem for many people.

Why is it Beneficial for Someone to Hire an Attorney for Filing Bankruptcy?

You can file bankruptcy by yourself if you want to; no one will stop you, but you should also realize that it’s a complicated process that even some lawyers who don’t handle it every day can mess up. There is a lot of terminology related to bankruptcy that people who don’t deal with it on a daily basis don’t understand, and there are a number of very specific requirements that trustees will require, including certain documents that are needed and when they have to have them, and if you mess any of that stuff up, your case can be dismissed.

A lot of people who try to do this without an attorney see their case dismissed, which means you lose the $300 filing fee and you lose the relief you’re seeking and the advantage of the automatic stay. In the long run, it’s always better to hire an attorney; it’s expensive, but you only have to do this once, and the bankruptcy will wipe out tens of thousands of dollars in debt, which is a lot more valuable than the attorney’s fee.

Doing it once and doing it right is very important, because the odds of making a mistake go way up. For example, you may forget to list certain debts, which means you still owe them, or you may not know how to fill out the forms properly, how to get things to the trustee, or many other things you have to do right. Hire someone who does that on a daily basis; they’ll do it the right way, with less for you to do, and it will only have to be done once.

Which Bankruptcy Chapter Can Stave Off Foreclosure?

In general, if you’re trying to fix a foreclosure, Chapter 13 is usually the way to go, although it depends on how much equity you have in the house, your income and the level of debt. Chapter 13 is suitable for people with regular income who are just having trouble keeping up with things, or if they have assets they don’t want liquidated by Chapter 7. If you have equity in your house, under Chapter 13, you can keep your house and enter a payment plan, which can stop a foreclosure.

On the other hand, in Chapter 7, the house will usually be sold by the Trustee and distributed to creditors, which means you lose all equity. That’s not always the case, but when facing foreclosure, Chapter 13 is the first place to look.

Which Chapter Is Best to Prevent Repossession of Vehicles?

Vehicles are worth less, so it’s less common for someone considering bankruptcy to have an issue in which their car is worth enough that the trustee will sell it. If you do happen to have an expensive vehicle that’s worth a lot of money and maybe it’s paid off or something like that, a Chapter 13 can work for you the same it works with a house you don’t want to lose; you can enter into a repayment plan and keep it.

For more information on Ways That Bankruptcy is Beneficial, a free initial consultation is your best next step. Get the information and legal answers you’re seeking by calling (801) 200-3795 today.

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