If you are not an expert when it comes to legal matter, you might have some questions filing for bankruptcy. Below are simple answers on the most common questions that have something to do with bankruptcy.

1. What is bankruptcy?

This is a legal action that could be done by an individual, a couple or a family with problems in paying with their debts. This offer everyone a chance to start again with all the debts discharged while offering creditors a nice repayment plan.

2. What does bankruptcy do?

The best thing that a bankruptcy could do is to stop creditors from collecting further from you. This filing could even stop foreclosure of your home, repossession of a vehicle, disconnection of utility service and stops the garnishment of your wage. It could even result to discharging all your debts or most of it so that you could have a new start and you will not anymore be burdened by your financial condition.

3. What can’t bankruptcy do?

When it comes to collaterals on a loan like your home, you could not keep your home if you will not make any payment arrangement in a form of repayment plan with your creditor. It would be impossible that the mortgage would be discharged while you keep your home. Do not feel down since if you are in the brink of foreclosure, you could save your house with this. The bankruptcy filing would force the mortgage company to accept your payments after the filing. There are also certain debts that this filing could not discharge like criminal restitution, student loan and child support.

4. How often could bankruptcy be filed?

For a chapter 13 bankruptcy, you could file any time. However, with the Chapter 7 bankruptcy, you are only allowed to file after six year from your last filing.

5. What are the options why filing for bankruptcy?

When filing for bankruptcy, you have two options, the Chapter 7 and Chapter 13. The chapter 7 is sometimes called the liquidation while the chapter 13 is restructuring of payments. With chapter 13 you need to present a repayment plan in the court to show that you could really pay your creditors in a certain span of time.

6. Why choose chapter 7 bankruptcy?

Chapter 7 bankruptcy is usually selected if a debtor wanted to eliminate all his debts and is ready to lose his properties or vehicles. The good thing with this is you could have a debt-free start. Make sure that after this bankruptcy, you would be more responsible with your finances.

7. Why Choose chapter 13 bankruptcy?

Chapter 13 bankruptcy claim is right for people who are just behind in payments. If you want to still keep your property, then it would be the best option. For the case to go your way, it is necessary that you convince the court that you are able to pay for the debts for a certain period of time while also being able to deal with your living expenses. You need to show the payment plan to the court.

8. How much does it cost?

This usually depends on the state where you are filing for bankruptcy. The best thing that you could do is to call the court in your place regarding the expense of filing the Chapter 7 and Chapter 13 bankruptcy. This cost is just for the filing, you also need to prepare for the cost of the preparation of all the documents needed and also for the professional fee of the lawyer if you decide to get the service of one.

9. How long will the record of bankruptcy stay in the credit report?

This would usually appear for about 10 years.

10. Is there a time that it would be too late to file for bankruptcy?

It is never too late for file for a bankruptcy claim.

If you need help in dealing with your current debts, please do not hesitate to contact  Riverside BankruptcyWe will help you to find the best solution for your problem.

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