If you are burdened with debts that you have no idea how you are going to pay, you may be asking yourself, “Can bankruptcy help ?”
While it may be the best solution, it is something that you need to carefully consider. Filing bankruptcy is not an easy out. It can be an extremely painful process, both emotionally and financially.
A bankruptcy will stay on your credit report for 10 years from the discharge date. This can impact all areas of your life – from your ability to buy a home to your ability to get a new job or even a promotion.
It is important to understand going in that bankruptcy may not wipe away all of your debts. Certain debts, such as child support obligations, tax debts and student loans are not dis-chargeable.
Because the impact of bankruptcy is so far reaching, it should only be considered as a last resort. You should probably explore both credit counseling and debt settlement before making the decision that bankruptcy is the best alternative for you.
Once you decide that bankruptcy is your best choice, you will want to get bankruptcy law help. You can get bankruptcy help in several forms, depending on your budget and the complexity of your case.
It is always a good idea to speak with an attorney to explore your options. Ideally, you can find an attorney who specializes in personal bankruptcy help that offers a free consultation. It is a good idea to interview more than one attorney, because fee structures can vary widely. You can search online for local attorneys but it is always a good idea to get a referral from someone your trust. Don’t be fooled into paying more for an attorney with a fancy office. You want a good attorney, but that doesn’t necessarily mean the most expensive one.
If you need to file bankruptcy but have limited funds you can still get filing bankruptcy help. One alternative is to find a low cost attorney that will prepare documents for you and allow you to file them yourself.
If even that is beyond your budget, there are numerous resources on the internet that can educate you on state laws. If you decide to file bankruptcy on your own, there are bankruptcy kits available that can provide a guide to your states laws as well as sample forms that you will need to complete your filing.
Chapter 7 or Chapter 13?
One reason to get personal bankruptcy help is that new bankruptcy laws make it more difficult for individuals to file Chapter 7. Every person who files Chapter 7 must pass a means test.
Essentially, the means test is designed to eliminate the ability of individuals with stable jobs and a relatively high income to file for Chapter 7. The goal of the law is to force more people to enter into a Chapter 13 bankruptcy plan.
As long as your income is less than the state median, the means test is fairly straightforward. However, an income that is more than the state median will require more calculations and more documents to be completed. This can be a bit complicated and having help with the calculations can be a good idea.
It is important to note that the means test figures changed as of November 1, 2009. In many states, it is now easier to qualify to file for Chapter 7.
After Bankruptcy Help
If you do elect to go through with a bankruptcy, it is important that you keep looking towards the future as you are going through the process. Bankruptcy can be an emotional experience and you are bound to feel feelings of failure, shame and embarrassment. If you lose your home during the bankruptcy process, the emotional impact can be even greater.
It is imperative to remember that no single time in your life will define you. Millions have gone through personal bankruptcies and gone on to be a huge success. Look at Robert Allen and Dave Ramsey!
One of the best things you can do when your case is discharged is to begin to reestablish credit. A secured credit card can be a good way to do this. Just be careful to use is responsibility and don’t fall into any old habits!
