With the recent recession period in America and other countries, there are many people who have gotten into huge amounts of debt and have no means of repaying their creditors. Chapter 7 bankruptcy is one of the options which have been put in place to help people get out of debt. This solution requires that one surrenders all their non-exempt assets to the courts of law so that a trustee is appointed and he liquidates them in order to pay the creditors.
When considering this solution you have to assess certain factors and gauge whether this is the best option for you. The amount of debt you owe is a very important piece of information as it will enable you to asses whether or not you can just pay off your creditors using a different loan or whether your debt is too huge and overwhelms you.
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Consider the amount of debt you owe and get a clear credit report and ask a financial analyst to assess the report for you. Ensure that your report has no mistakes and your debts are all valid.
You must also assess your non-exempt assets. The exempt assets only cover things like auto mobiles, furniture and sometimes the mortgage. If you have businesses or boats and other luxurious assets, then you must assess whether or not you can let go of them without suffering major losses. If you own a business with other partners then you might want to opt for other means as they might unfairly lose their business because of your action.
Another thing you must consider is the amount of time it will take for your plea to be approved. This varies with each individual depending on certain factors. The first consideration is whether or not you have valuable assets. When you do not have assets, then there are less objections from your creditors and this speeds up the approval process. However, for those who have assets then many objections are likely to arise from their creditors and delay the process. This process might take between months and even years to be approved.
The implications that your plea will have on your financial record and social life are also important factors to bear in mind. This is because some employers will not want to employ a bankrupt individual and you will not be eligible for credit facilities in as long as the financial predicament is in your record.
Whether or not you hire an attorney is entirely up to you. In some cases an attorney might prove to be a luxury especially if you're deep in debt. However, the services of an attorney might help you fend off the persistent harassing creditors and also provide you with guidance in your situation. A good attorney might also help you fight objections put up by your creditors.
You might also want to gauge other options before you file for chapter 7 bankruptcy. This might include using the alternative Chapter 13 which is much cheaper in terms of the time spent and allows you to pay off the debts slowly thus, provoking less objections from your creditors.
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