4 Things To Know About Filing For Chapter 7 Bankruptcy

When it comes to dealing with financial difficulty, you may need some assistance. It is possible to get some relief from mountains of debt you can't pay by filing for a Chapter 7 bankruptcy. This may eliminate all of your debts if you qualify. Knowing certain things about this type of bankruptcy may motivate you to get started on the application.

Eligibility

Before you can get your debt discharged by Chapter 7 bankruptcy, you must first be eligible. You must prove to the courts that you don't have the necessary amount of income to pay your debt.

You will be asked to take a means test that will determine if you are indeed eligible or not.

Forms

Additionally, you will need to complete a number of forms to identify your current financial status.

Listed below is the information you will need to provide:

1. Your current income as evidenced by a W-2 or other official means.

2  Your monthly living expenses that may include rent, clothing and food.

3. The total amount of your debt that is owed to each creditor. If you owe more than one creditor, this should be individually listed.

The courts will take a close look at your financial situation to determine if you qualify for bankruptcy or not.

Debts

When it comes to getting your debt discharged, it's important to know which ones will qualify for doing so. Unsecured debt is the most common type of being relieved, and this is debt that is not backed by collateral.

Credit card debt can usually be wiped away when you have secured a Chapter 7 bankruptcy by the court system. You will be advised of what debts will be discharged.

Costs

The last thing you will want to do when unable to pay the debt is to be faced with steep fees for filing for Chapter 7 bankruptcy. This is not the case because as of June 1, 2014; you only need to pay $335 for court costs and administrative fees for this type of bankruptcy.

However, if you do retain the services of an attorney to assist you with filing, the amount you are required to pay your lawyer will be in addition to this amount.

Finally, being able to get rid of debt that you can't pay can increase your peace of mind. Be sure to work with a bankruptcy attorney like one from Brackett & Strunk LLC if you need assistance filing for this legal status.