Posts Tagged ‘filing bankruptcy as an individual debtor’

Filing Bankruptcy As An Individual Debtor

If you are considering filing bankruptcy as an individual debtor, there is a set procedure that you need to follow. However, before you finally decide to go for it, it is very important for you to make sure that there are no better alternatives available for you. Always remember, bankruptcy is not an easy debt relief option. Though it is true that it does provide protection to the debtor and helps him or her to get rid of most of his or her debt problems, it is also true at the same time that it seriously damages his or her financial life. You will have to restart your financial life right from scratch, which is obviously not an easy thing to do, but not impossible also. If you are going to file your petition for it as an individual debtor, there are plenty of things that you need to keep in mind, especially about the laws applicable in this regard. Following is a brief overview on it.

Discuss Your Case With A Reputable Lawyer

When it comes to filing bankruptcy as an individual debtor, the laws can be very complicated, especially for someone who is not a legal expert. That is the reason why it is always advisable to find a reputable bankruptcy attorney and then discuss your case with him or her thoroughly. Make sure that the lawyer you are hiring is duly licensed to handle such cases in your state and that he or she is highly experienced in handling cases similar to yours with a great success record. Besides that, you also need to make sure that the attorney fee is a reasonable one, something that you can afford to pay. You can get some good referrals by contacting the local bar association.

Collect All Necessary Financial Papers

While you are discussing your case with the attorney whether you should be filing bankruptcy as an individual debtor or not, make sure you bring all necessary financial documents to the meeting. These documents may include your bank statements from the last six months, paycheck stubs, statements of debt accounts, the payments receipts for the debts you have already paid, utility bills, and a sample budget plan that you usually follow (if you are already following a budget plan). When your lawyer reviews all this information, he o she will be in a better position to provide you the best advice suitable to your specific case. Always remember, the best bankruptcy attorney is the one who helps you avoid it. If the lawyer you have hired directly starts suggesting you on how to go ahead and file for bankruptcy, you should consider switching to another lawyer.

The Type Of Bankruptcy You Are Eligible For

Just because you think that filing bankruptcy as an individual debtor sound like the right option for you, it does not mean that you can file your petition under whichever chapter you like. With the introduction of the new bankruptcy laws in the year 2005, there are certain eligibility criteria that you must first meet in order to determine which type of bankruptcy you qualify for. As part of the process, you will have to pass a means test and go for a credit counseling session with a state-approved credit counselor. The attorney will look at the result of the means test and the certificate from the credit counselor to determine whether you should file your petition under chapter 7 or chapter 13.

Overall, as you can see, though bankruptcy looks like an easy debt relief option, the process is a very complex one. If you are seriously considering filing bankruptcy as an individual debtor, you will need the assistance from a legal expert to make an informed decision in this regard.


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