It’s no secret that filing for bankruptcy can be a scary thing. This is because while there are benefits to doing so, there are also some very real consequences associated with filing for bankruptcy that can affect you for many years to come. Plus, since the average person has never had to file for bankruptcy, there is a lot of misinformation going around. Therefore, you might be reluctant to file for bankruptcy on the basis of something that is completely manufactured.
For example, many people think that declaring bankruptcy means that you will automatically lose your home. However, this is not necessarily the case. With that in mind, let’s consider whether filing for bankruptcy means you’ll lose your home.
What does it mean to file for bankruptcy?
For those who may not fully understand the concept, filing for bankruptcy means that a person (or business) legally files a request for debt cancellation. This is usually done because their unpaid debts are too expensive for them to pay, and they need to eliminate the debt in order to start rebuilding their finances. The assets of the individual or business are then valued and valued and can be used to repay part of the debts.
The most common types of bankruptcy
While there are different types of bankruptcy, there are three that are most common for individuals and organizations. They are:
- Chapter 7: This is the liquidation of assets. It allows businesses or individuals to get rid of unsecured debt (i.e. medical bills and credit card bills) and is for those who may not have a lot of things of value that can be used to repay overdue debts. This is one of the fastest ways to prevent various collection agencies from constantly contacting you, seizing your wages / taxes, foreclosing your home, repossessing your property, etc. assets are used to pay off your debts.
- Chapter 11: This type of bankruptcy involves the reorganization of companies or individuals. This is most often used for business, but can also be used for organizations. The purpose of the Chapter 11 filing is to reorganize the finances of the business to allow the business to become profitable again.
- Chapter 13: The last most common type of bankruptcy is Chapter 13. It is about reducing debts and allowing the person in debt to pay off their debts using payment plans that are more suited to their budget. These repayments are often made in installments over a period of 3 to 5 years.
Does Filing For Bankruptcy Mean I’m Going To Lose My Home?
While filing for bankruptcy could mean you will lose your home, it doesn’t have to be. In fact, many people who file for bankruptcy are able to keep both their homes and their vehicles. However, much of that depends on whether or not your home meets the exemption threshold in your state. If you are not sure about this, you definitely want to find out before you deposit. Otherwise, you might have a rude awakening after filing your case.
Fortunately, since it has long been established that most people need their homes and vehicles in order to make a living and rebuild their finances, many realtors, lawyers, etc., make sure your home hits the mark. the threshold long before you. never even consider filing for bankruptcy.
Helping clients navigate the bankruptcy process
If you’re looking for reputable attorneys who are used to helping clients navigate the bankruptcy process, we’re here to help. At Jerry E. Smith, Bankruptcy and Tax Resolution Attorney, we understand first-hand how difficult, time-consuming and tedious the process of filing for bankruptcy can be. As such, we go above and beyond to provide each customer with personalized support and solutions that can make the process as quick and painless as possible.
By working with Indianapolis bankruptcy attorney, Jerry E. Smith, you will benefit from his proven reputation for helping clients navigate the bankruptcy process. Smith has extensive financial information and leverages his financial and legal expertise to ensure that every client gets a fair deal when filing for bankruptcy.
Proudly help clients navigate the bankruptcy process, here at Jerry E. Smith Attorney Bankruptcy, we do our best to enable all of our clients to put their debts behind them and move forward in a less stressful way that is more conducive to a stress free life. There is no need to be afraid of declaring bankruptcy. With the help of our team of experts, we will guide you from start to finish.
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