Filing for bankruptcy

Filing for bankruptcyOne of the most commonly done searches by individuals and business relating to finance is about how to file a bankruptcy process. Sure, it is a huge task and has to be carefully handled by the professional who is filing bankruptcy for you. Hence, it is commonly advised to seek an attorney or lawyer who is highly qualified at filing bankruptcy, in order to smoothen the process.

There are two types of filing a bankruptcy: Chapter 7 and Chapter 13. Both of these Chapter 7 bankruptcy and Chapter 13 bankruptcy have different rules. So, before filing, you first have to identify what type of bankruptcy you should file for. For both, the lawyers or agencies charge somewhere between $500 – $1,000.

But before filing for bankruptcy, the debtor has to follow a few procedures. It begins with obtaining a credit counselling certificate. To obtain one, the debtor can get in touch with any organization that is allowed to provide such a certificate. The fee is around $15 – $100. The charges are dependent on the type of the organization that you’re getting it from. The certificate is a form of the 2005 Bankruptcy act.

The second procedure is to buy the debtor education certificate. The prices vary according to the organization from where you buy it. It is although mandatory to buy the debtor education certificate, especially when the 2005 bankruptcy act requires you to have one. It is seen that a lot of people aren’t aware of this procedure. As per reports, a large number of people who are unaware of such things find their queries being denied by the bankruptcy court. Hence, it is important to buy the certificates. It is easily obtainable.

It is also to be noted that once the bankruptcy court denies the debtor because he doesn’t have a debtor education certificate, he won’t be benefitting from bankruptcy discharge. In order to get the bankruptcy discharge, the debtor has to start over again by reopening bankruptcy, obtaining the debtor education certificate, and then come to the court. This can be highly expensive. The entire process from starting over to finally obtaining a discharge can cost over $1000. Just getting a certificate is as low as $15 depending on the agency that you get it from.

The third procedure is to pay the bankruptcy filing fee. In addition to this, the debtor must also submit a bankruptcy petition. The bankruptcy petition contains a list of schedules that the debtor will be required to furnish. The schedules ask the debtor to indicate:

Schedule A – Real estate property that the debtor owns

Schedule B – Debtor’s personal property

Schedule C – Exemptions claimed by the debtor

Schedule D – Debtor’s scheduled debts

Schedule E – Debtor’s priority debts

Schedule F – Debtor’s unsecured debts and so on.

The list goes till Schedule J in which the debtor has to list the expenses. The petition for Chapter 13 is similar to Chapter 7. However, the debtor must fulfil all the requirements in order to get the bankruptcy through. It is always good to seek for the help of a reputable bankruptcy attorney or bankruptcy lawyer to get you through the tedious process.

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