Even without the existence of Debtors' Prisons, folks facing the decision to legally renege on their debts--i.e. declare bankruptcy or insolvency--still face a huge, difficult decision--to file or not to file for bankruptcy. Here are a few frequently asked questions and the answers.
WHAT IS BANKRUPTCY?
Bankruptcy is a codified process under law to protect debtors who cannot pay back their debts as they mature from harassment, lawsuits and penalties imposed by creditors. It is a provision allowed by law that allows you to legally freeze your debts and not pay them pending court proceedings under the Bankruptcy Code. By declaring yourself bankrupt, you are testifying to the following:
Bankruptcy Attorney Albuquerque, Idaho Bankruptcy Lawyer, Massachusetts Bankruptcy Lawyer,
1. Your debts or liabilities are more than your assets
2. In the foreseeable future, it is impossible for you to pay everyone 100% of what they are owed.
Note that this article only deals with personal bankruptcy, not business bankruptcy.
WHAT SHOULD GO INTO MY DECISION TO DECLARE BANKRPUTCY?
The most prevalent reason that most certainly lead you (correctly, I might add) to declare bankruptcy is: your reasoned belief that you have unpaid liabilities that are in excess of your near term ability to pay them back. Near term is usually defined as 12 to 18 months.
Several reasons may exist for this condition. Most popular are: loss of job, divorce, medical treatments, loss of substantial investment, government or court action freezing your assets.
HOW SHOULD I PREPARE FOR BANKRUPTCY?
Before you hire a lawyer, do some homework. Realistically, list three things for the next 12 months: your income, your assets and your liabilities. Before plunging into bankruptcy, evaluate other alternatives. These include: negotiating reduction in your liabilities, negotiating a longer term pay out from your substantial creditors and disputing major claims. Communicate with your trusted friends and relatives. You don't want them to know from some third source that you are insolvent, because remember, bankruptcy filing is a public, searchable event. Lay out your reason, what it would mean to your lifestyle and the benefits. And, very important--how to exit bankruptcy within a reasonable time. Once you have decided on bankruptcy, and you have a list of the items I mentioned above, hire a lawyer to intercede in your behalf. Don't go to debt counselers unless you believe they can substantially reduce your debt burden or extend time of payment.
WHAT HAPPENS TO MY DEBTS IN BANKRUPTCY?
They are frozen, i.e. you do not need to pay them at least till a Judge hears your case.He may order you to pay, or may suspend payments indefinitely. But remember,
WHAT HAPPENS IN BANKRUPTCY?
There is a hearing before the judge or his clerk. You should be consistent with your side of the case, because there may be challenges from people who think your are hiding wealth.
The judge asks you or your lawyer about plans to operate as an insolvent. A plan is made and you have to follow it till you are discharged. The plan may include request to write off part of the debt.
Remember certain debts do not go away--such as payroll liability to IRS.
Good luck.
Is Bankruptcy Right For You? Talk to Bankruptcy Attorneys Free and Confidential. Licensed bankruptcy attorneys are available. Attorneys will call you to discuss your case for free. Find out if bankruptcy is right for your situation.
Rating of US Bankruptcy Code
Get Online Application at online Bankruptcy Lawyer.
0 comments:
Post a Comment