When you find that your debts are no longer manageable, bankruptcy can be a highly effective way of ensuring that you are able to start over with your finances. Yet, there is a strong chance that you are not particularly informed about this type of legal proceeding, and if this is the case you, it might be helpful for you to consider the answers to the following bankruptcy questions to make it easier for you to decide whether this is a good option for your situation.
Will You Lose All Your Possessions And Assets In A Bankruptcy?
There is a common fear among those that are considering filing for this protection that they will lose all of their assets. Luckily, this is not the case as it might be possible for you to file for a Chapter 13 bankruptcy, which will help you to avoid the loss of your possessions. During this type of filing your debts are simply restructured to make them easier for you to pay.
In some instances, you might not qualify for a Chapter 13 bankruptcy, which will force you to opt for a Chapter 7. While it is true that assets can be liquidated in this type of bankruptcy filing, you should be relieved to learn that any possessions will be exempt. This is done to ensure that you are able to start over again. For example, if you are a commercial driver, your truck will be exempt from liquidation as this would cause you to lose your source of income.
How Will A Bankruptcy Filing Impact Current Collection Actions Against You?
Depending on the size of your debts, your creditors may be able to take aggressive collection actions, which can include wage garnishments, liens, lawsuits and a host of other actions. Luckily, if you file bankruptcy, the courts will send notice to your creditors informing them to cease all collection actions immediately.
What If You Are Unable To Afford An Attorney?
Sadly, some people may not seriously consider bankruptcy a viable option because they are concerned about the expenses of hiring an attorney. Fortunately, attorneys are often used to working with bankruptcy clients with limited financial means. As a result, they will often work out payment plans to make it easier for the client to pay for representation. Additionally, those filing a Chapter 13 bankruptcy can list their attorney as a creditor, which will allow them to be included in the repayment plan. The exact options will vary, which might cause you to need to speak with several attorneys to locate one with payment options that work for your situation.
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