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A Simple Guide About What Happens When You File for Bankruptcy

However simple it may be to get some loans from a bank or any other lender, the truth is that certain conditions may make you find it very hard to pay back the debt. One area of concern once you realize you are bot able to settle all the debts is the next step that is best for you. Even though bankruptcy is never a nice topic for most business and people, it is already with us and the best we can do is to enlighten you on the right step to take should you be a victim. One of the key things that you need to note is that bankruptcy is a legal process meaning that everything is decided in court and it involves both the lender and the debtor.

One of the most basic thing that you need to know about is the process and whatever happens in court. Those who play the role of making the decision are the judge and the trustee who is hired for the case. The two parties will take their time and have a review and finally make a decision whether you are eligible for bankruptcy or not.

Another important point for you to note is the fact that we have very many types of bankruptcy. Among the various types of bankruptcy is chapter 11, chapter 12 and chapter 13 whereas chapter 7 is the most common one. You also ought to know that chapter 12 is in most cases occupation-based occupation-based. As you view here now, you will also discover more than chapter 7 forgives a lot of debts that have no collateral and it also incurs the risk of selling some of the important property that you may own to pay part of the debt.

You should always consider this task demanding when it comes to the time as well as expenses. Remember you will have to meet the credit counselor for bankruptcy and debt as well as putting all the relevant information in place for the process. Be prompt to show the court that you made efforts in ensuring that everything is settled.

Your financial situation is the next greatest tool for the court before a decision is made. This is done by the court trustee, the lawyer and the creditor. You should, however, have it that the process takes several days or even months and in some cases could go as long as 6 months. With the tips above, you will know all things that are important to you before you file for bankruptcy.

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