Filing for bankruptcy can be one of the most intimidating financial decisions to make. Learning more about the process, what to expect, and the steps to take may help you better prepare for bankruptcy. You do not have to go through this process alone. Feel free to consult with a Kingsport bankruptcy lawyer who can guide you through your bankruptcy and answer any questions you may have.
What to Expect from Bankruptcy
What makes so many people avoid bankruptcy are all the most common consequences of bankruptcy. However, when you start looking closer at the consequences of bankruptcy, you might realize that they are not as permanent as you think. These consequences of bankruptcy include:
Lower credit score
The possibility of selling your property
Bankruptcy is listed on your credit history
Bankruptcy can be found in a public record
While some of these initially sound like things that seem impossible to recover from, this is not always the case. For example, credit scores might be lowered from bankruptcy, but they can be rebuilt over time. Extremely high credit scores to begin with may not suffer much of an impact after bankruptcy.
The possibility of selling your property during bankruptcy usually involves selling your vehicle or home. However, this only applies to certain types of bankruptcy. This can be prevented with a reaffirmation agreement in some cases.
Bankruptcy might be listed on your credit history but usually only for ten years. Even though bankruptcy might be a public record, someone would have to go out of their way to find this information. On the positive side, bankruptcy was designed to help people escape crushing debt.
What you can expect when filing for bankruptcy is multiple options in terms of the type of bankruptcy you want to file for. In some cases, all your debt will be erased. Whereas in other cases, you may still have to pay back some of your debt but at a lower monthly payment with a lower interest rate.
How to Prepare for Bankruptcy
When it comes to preparing for bankruptcy, the first step is to figure out which bankruptcy you can file for. The four common types of bankruptcy are Chapter 7, Chapter 13, Chapter 12, and Chapter 11 bankruptcy. Each of these has its own eligibility criteria and benefits.
Be prepared to fill out multiple forms, provide detailed financial information, and answer questions about your debt. If the bankruptcy you are filing for does not discharge all your debt, be prepared to fill out a reaffirmation agreement. This will stop creditors from repossessing or taking your home or vehicle.
Consider consulting with a bankruptcy lawyer if you have any other questions or concerns about bankruptcy. A lawyer can help you with the legal processes of bankruptcy.
Contact Tom Bible Law Today
The bankruptcy process can be complex and confusing at times. Contact us at Tom Bible Law today at (423) 424-3116 for a consultation about the bankruptcy process. Our legal team of Tennessee bankruptcy attorneys can help you start taking steps to prepare for bankruptcy. We are located in the Tennessee cities of Chattanooga, Kingsport, and Tullahoma.