| What is Bankruptcy?
Unfortunately, for some people the ratio of income versus owed debt becomes too much to bear. They aren’t making enough money to pay their creditors and, in many cases, aren’t able to make the minimum payments due. For many, the only solution is to file for bankruptcy, in which a person is declared incapable of making payments to his creditors by the courts. In most cases bankruptcy is voluntary - meaning the person in question approaches the courts in order to make the filing. Most people choose to do this with the aid of a bankruptcy attorney.
How do I know Bankruptcy is the Solution?
The decision to file for bankruptcy is not easy, but neither is struggling with insurmountable debt. The average person struggles with debt for at least a year before coming to the conclusion that bankruptcy is the only way out. A good way to determine if bankruptcy is right for you is to sit down with your budget and list your debts. It may be time to seek legal help if you can’t figure out how to budget yourself out of debt within a time period of no more than five years. A Nevada bankruptcy attorney will be able to help you review your budget, whether or not you are making minimum payments on your bills, and any other financial or employment changes to determine what course of action is right for you.
The Bankruptcy Process
The process of filing for bankruptcy differs from state to state and depends upon your individual situation. Certain aspects are the same for each person. When filing for Chapter 7 bankruptcy, for example, you will be required to file a 'statement of financial affairs' with the federal bankruptcy court. These papers will include a list of all of your creditors, what you owe, and details regarding your current level of income.
Within a month or so of filing you will be required to appear at what is known as a '341 meeting' in which you will be asked a series of questions under oath regarding your debt. Your creditors are invited to this meeting, but rarely attend. They have up to 60 days after the 341 meeting to convince the courts you shouldn't be allowed to claim bankruptcy.
Will I Lose Everything if I File for Bankruptcy
Bankruptcy proceedings are meant to give individuals a fresh financial start without adding additional financial crisis. For example, most people are usually able to keep their homes, clothing, books, and any property they need in order to run their businesses or maintain their households. There are, of course, limits to the values of the items you are allowed to keep, but no one is going to come into your house with a pile of cardboard boxes and leave you standing with only the clothes on your back.
You should note that the bankruptcy process may stop banks and auto lenders from collecting past due balances on your home or vehicle, but the process will not stop them from foreclosing on your home or repossessing your car. The entire bankruptcy process can be a bit complicated, but your Nevada bankruptcy lawyer will be able to guide you through each step.
Will Filing for Bankruptcy Eliminate all of my Debt?
Back in April of 2005, President Bush signed the Bankruptcy Abuse Prevention and Consumer Protection Act into law. This bill limited the ability of American's to file for bankruptcy, including changes in who is allowed to file for Chapter 7, how much people filing for Chapter 13 must be able to pay, and the types of debt that can be eliminated.
There are certain types of debt that bankruptcy will not eliminate. These include payments relating to alimony, child support, back taxes owed on both the federal or state level, and federal student loans. In addition, you can not write off luxury debts incurred within 90 days of filing for bankruptcy, any debt you incurred due to fraudulent activity, or cash advances over a certain amount.
These laws and rules are designed to prevent abuse of the bankruptcy system. Your Nevada bankruptcy attorney will work with you to review your debts and determine what you can eliminate and what you will have to continue paying.
How Can We Help?
The lawyers at Rob Graham & Associates are here to help you through the bankruptcy process. We'll review your financial situation before you file, help you determine which course of action is right for you, and be present with you at your 341 meeting and any other hearings you may be required to attend. Contact a Nevada bankruptcy attorney at Rob Graham & Associates today for more information on how we can support you through the bankruptcy process. |
