A Bankruptcy Lawyer can Help Find Solutions to Your Debt Crisis

While no one wants to file bankruptcy, sometimes it is the best solution to mounting debt problems. It is not a quick fix. There are consequences but these consequences can be effectively managed. Before deciding on this debt solution, there are some things you should know about bankruptcy. There are two types of bankruptcy for an individual; chapter 7 and chapter 13 bankruptcies.

Chapter 7 bankruptcy is a true bankruptcy and involves liquidating your personal assets and setting up a payment plan to pay back creditors. The court may be able to discharge certain debts, meaning you will not be responsible for paying those debts back to creditors. Most bankruptcy proceedings require you to attend approved credit counseling classes before filing. A bankruptcy lawyer can give you more details about what is required for filing Chapter 7 bankruptcy.

While chapter 7 bankruptcies involve total liquidation of most of your personal assets to repay your debts, chapter 13 bankruptcy is more of a debt consolidation arrangement. With chapter 13 bankruptcy, you are making payments to a trustee, who then makes payments to each of your creditors at a pre-determined payment amount. Chapter 13 does not discharge your debts, but rather gives you time to pay them back on time while you get back on your feet financially. As with chapter 7 bankruptcy, you must also attend approved credit counseling classes before filing. Consumercredit.com provides a free credit counseling certificate approved by the Department of Justice.

Being financially strapped can take its toll on your health, both mentally and physically. You may wake up and go to bed fatigued, even if you are not working at a job. Bill collectors may not understand, or even care that you have lost your job, are disabled, sick or incapacitated in some other way. Some days, it may seem like you just do not know which way to turn. Don’t give up before you contact a personal bankruptcy lawyer.