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Should You File for Bankruptcy? What You Should Know First

Should You File for Bankruptcy? What You Should Know First

During these difficult economic times many people drowning in debt may begin to ask themselves, should I file for bankruptcy? With bills mounting, debts becoming overwhelming, and options running out – families may begin to panic in the face of daunting financial crisis. To many, “bankruptcy” is a word that conjures feelings of embarrassment or reflects sentiments of weakness. This simply is not true. Instead, for the vast majority of people who engage the process, bankruptcy provides them with a new beginning and a clean slate. Filing for bankruptcy stops creditors from constantly sending harassing letters and making continuous calls and, in the end, it may provide the debtor with a complete discharge of his or her debts. In order to decide if one should file for bankruptcy it helps to know a little more about the process itself. The first step in filing for bankruptcy is the filing of the bankruptcy petition with the United States Bankruptcy Court in the state where the debtor lives. Immediately upon filing creditors are bound by the automatic stay and are prohibited from contacting the debtor regarding the collection of debts. Within the petition, the debtor will list all of the property that they own and other information which will provide the court with all of the information it needs to understand that debtor’s entire financial situation. During the automatic stay period, the debtor can attempt to protect certain kinds of property from the bankruptcy proceedings by making use of some of the many exemptions that the Bankruptcy Code provides. The filing of the bankruptcy petition, including the classification of debts and exemptions, can be very complicated. It is strongly advised that debtors seek out the advice of an experienced attorney before doing so. After the petition is filed, the debtor will have to appear before the bankruptcy trustee who will review the petition and ascertain if there are any available funds to satisfy any money owed to creditors. Usually, if the debtor has hired an attorney, the attorney will accompany them to this meeting which, for the debtor, is often one of life’s more difficult moments. If the trustee discerns that there are no available funds to repay the debts that are owed to the creditors the debtor will receive a discharge order from the court indicating that he or she is discharged of all outstanding debts and then all creditors will be notified that the debtor is no longer liable for their debts. If you are having trouble dealing with your consumer debt and deciding if you should file for bankruptcy it is imperative that you seek the advice of experienced legal counsel to advise you on the issues concerning bankruptcy. For more information regarding if you should file for Chapter 7 bankruptcy, Chapter 13 bankruptcy, foreclosure or any other consumer debt issues in New Jersey visit TheNJBankruptcyAttorney.com. This blog is for informational purposes only and not intended to replace the advice of an attorney

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