Filing For Bankruptcy: A Primer

18 March 2016
 Categories: , Blog


Filing for bankruptcy can be a difficult experience, especially if you have never experienced it before. There are a few steps in filing for bankruptcy that you should probably know about before you get too deep into the situation. Throughout the course of this brief article, you'll learn a little bit about what you should do before and when you're filing for bankruptcy.

Find An Attorney

It is imperative that the attorney you hire specialize in bankruptcy and have a robust understanding of Chapter 7, Chapter 11, and Chapter 13 bankruptcy filings. A bankruptcy attorney will not only act as an advocate for you, but can help you file difficult paperwork and make sense of the legal jargon you will be subjected to throughout the process.

Budgeting Your Expenses and Finances

Your financial situation will most likely be quite rocky while filing for bankruptcy. You should budget according to the estimate of your post-bankruptcy finances immediately, which means that you should cut back on excess spending and stick strictly to those elements of your home life that are necessary. This means that you should not be spending an excessive amount on frivolous items or events, like video games or movies.

Stop Taking Out Loans

In most cases, bankruptcy will absolve you from having to pay outstanding loans, with a few exceptions (student loans, for example, are not forgiven). You should not, under any circumstances, take out or attempt to finance any new loans. Not only will this look horrible on your credit score, but taking out new loans will also be considered irresponsible in the eyes of the judge who is reviewing your case.

Cease Paying Bills

This statement requires some unpacking. You won't merely cease paying your bills, but rather, with the help of your bankruptcy attorney, you will have to contact the entity to which you owe the bills or the lenders to whom you owe loan payments to, and explain that you are currently undergoing the process for filing for bankruptcy. Some businesses will be immediately understanding of this situation and can put a hold on your bills within a short period of time, while others will require a notarized letter from your lawyer stating that you are currently filing for bankruptcy.

Although filing for bankruptcy can be a difficult task, there are some things of which can help you out with the process. Hopefully, this brief article has given you some idea of a few tips that can ameliorate this rather trying task.