We know that for some people, bankruptcy is still a taboo subject, and not everyone shares our passion for helping people get the financial freedom they need, so it can be hard to find out what you need to know about bankruptcy.
Here are 10 things you need to know about bankruptcy.
1.There are different types of bankruptcy
Towns and cities may file for Chapter 9 to reorganize, businesses may file for Chapter 11, Fishermen and family farmers may file for Chapter 12 and bankruptcy involving people from different countries is filed under Chapter 15.
2. It costs to file bankruptcy
There is a cost of filing for bankruptcy in Minnesota, and you bankruptcy attorney will be able to tell you more about the current cost.
3. You’ll need to factor in your bankruptcy attorney’s fees too
In order to ensure that your case has the best chance of success you’ll want to make sure that you leave it to the professionals. This means letting an experienced bankruptcy attorney handle you case.
There will be a fee involved, but it’s worth it for the peace of mind, an end to sleepless nights, and the fact that you don’t need to worry about whether you’ve filled in the paperwork properly.
4. You can do it yourself
What you probably didn’t know about bankruptcy is that you can, in fact, file for bankruptcy without an attorney.
Obviously we wouldn’t recommend it for many reasons, unless you’re experienced in bankruptcy law, know all about which assets are exempt, and fill in bankruptcy forms on a regular basis, you’re likely to make a mistake.
Because we handle bankruptcy cases on a daily basis, we know all about bankruptcy.
5. 341 Creditors Meeting
You’ll have to go to a meeting with your creditors, run by a trustee and you’ll be asked a number of questions regarding your finances and your assets.
This will take place in a meeting room, rather than a courtroom, and there won’t be a judge present.
Although it’s called a creditors meeting, it’s unlikely you creditors will actually turn up, unless they have specific reason to. This could include to verify that you’re not committing fraud, or to find out whether you’re going to continue paying for your car, or whether you’ll surrender it.
6. You’ll need to go into detail
You’ll need to go into a lot of detail about your finances, your assets, and whether you’re owed money from anyone.
This is why it’s a good idea to let an experienced bankruptcy attorney handle your case, rather than try and do it yourself.
7. It won’t eliminate all debts
Whilst filing for Chapter 7 or Chapter 13 Bankruptcy can eliminate a lot of debt, it may not eliminate all of your debts.
This is another reason why it’s a good idea to let a bankruptcy attorney handle your case, so you know what to include and what to leave out.
8. You will be able to get credit in the future
Although it sounds illogical, and on paper is perhaps like taking an alcoholic to a bar, those who have filed for bankruptcy are nearly always able to get credit again.
Lenders make money when you borrow from them. So because you don’t have any other debts, you’re far more likely to pay your credit card bill at the end of the month. This makes you a far better risk than someone who has tens of thousands of dollars in credit card debt, loans and missed mortgage payments, who could file for bankruptcy at any time.
Filing for bankruptcy can actually help you to repair your credit score and bring your interest rates down over time.
9. Start to live again
From sleeping better and answering your phone again, to actually being able to put food on the table, pay your utility bills and put gas in the car to get to work, you’ll be a lot better off after bankruptcy than you were.
10. Get on with the rest of your life
Once you have been declared bankrupt, you’ll be able to get on with the rest of your life.
Surprisingly few bankruptcy cases are due to deliberate overspending, and there are many reasons why people find themselves in unmanageable debt, such as due to medical expenses or unexpected bills, to having to pay back someone else’s student loan.
After bankruptcy you will be better prepared to recover from your medical condition, find a job, or move on after a divorce.
If you need help and advice to see whether filing for bankruptcy is right for you, why not fill out our Free Bankruptcy Evaluation form or Contact Us at 612.824.4357 now and speak to an experienced Minnesota bankruptcy attorney today?