When money gets tighter and tighter, the idea of bankruptcy comes to mind. But what happens when you declare bankruptcy? What comes next?
Let’s take a step back for a minute. Do you need to file for bankruptcy? If the bank threatens to foreclose on the house or bill collectors are driving you crazy, the answer is yes. When you cannot pay your debts, Chapter 7 will liquidate as much of your assets as necessary to fulfill your obligations. Chapter 13 offers a way of paying what you owe over time.
The downside is that bankruptcy seriously affects your credit score, with Chapter 7 remaining on your record for 10 years, while Chapter 13 only stays on for 7 years. Typically Chapter 13y benefits people with higher incomes.
Sometimes bankruptcy increases insurance rates, too. Then there are mounds of paperwork. So, you are much better off getting a bankruptcy lawyer near you than trying to go it alone. That’s where Voloshen Law Firm, PC comes into play. We have offices in Bucks County, PA, and Boca Raton, FL., where you can get help to untangle all the red tape that goes into the process.
You Declare Bankruptcy, What Happens Next?
There is some relief after filing for Bankruptcy. Debt collectors cannot continue badgering you. The bank cannot repossess your vehicle, and the bank’s effort to foreclose cease. No letters, no calls, no legal actions, and no personal contact can persist.
Throughout the process, Voloshen Law acts as a trustee. It is our job to schedule a hearing and notify creditors of your change in status. We will oversee your asset liquidation for Chapter 7, and oversee the repayment of your debts for Chapter 13, while your case moves forward.
Meeting with Creditors
It will be necessary to call on your creditors for a meeting (called a 341 meeting). Here you will state your assets and debts under oath. Your Trustee handles the process.
Learning Financial Management
At some point, you will have to take credit counseling, usually before filing, then again afterward based on the outcome of your case.
What is Discharge in Bankruptcy?
Once your bankruptcy is discharged, you are released from liability for debts as specified in your agreement. For Chapter 7, it takes the court 4 months to complete the case. Chapter 13 can take up to 4 years.
Will Bankruptcy Pay All My Bills?
Potentially. You can reaffirm certain debts and leave them out of the process. This means you must continue paying that debt on time. Beyond that, if you still have remaining depths after liquidating your assets, those are forgiven.
Seek a Bankruptcy firm near you for assistance, like Voloshen Law Firm, PC. You probably don’t know the ins and outs of what happens next when it comes to bankruptcy. It’s our job to protect your best interests. From start to finish, from petition to final decree, we are working for you.
We do offer remote consultations for your convenience. You can also use our online contact form or call our Philadelphia, PA, office at 215-437-7845 for further information.