Filing for bankruptcy is an opportunity for a clean slate. The moment a petition is filed, an automatic stay is imposed, forcing debt collectors to stop hounding you. This provides some immediate relief and enables you to shift your focus to developing a proactive solution for financial stability.
Why File for Bankruptcy?
Bankruptcy laws exist to provide a safeguard for people who are overwhelmed by debt. During the consumer bankruptcy process, an individual petitions the courts to release them from financial liabilities. The nature of your debts and how they are affected in the bankruptcy depend on what chapter of bankruptcy being is filed (Chapter 7 or Chapter 13). Whether you file for Chapter 7 or Chapter 13 will be decided by you and your lawyer, so begin the process by consulting an attorney.
If your financial obligations have accumulated to the point where you can no longer keep up, filing for bankruptcy may be your best option.
Knowing When To File Bankruptcy
There is never an ideal time to file for bankruptcy. However, if you’re considering it as a viable option, it’s a good idea to estimate how long it will take you to pay off your debts and how much interest you will pay over that time period. The law exists to protect you, not punish you.
If you are concerned about the cost of filing for bankruptcy, Flexer Law can help ease the burden. We offer payment plans and even arrange for your legal fees to be included in your bankruptcy plan. As always, the initial consultation is always free and many times you can file for no money down.
Beware of Bankruptcy Myths
The filing process can seem uncertain and confusing — even scary. While it is important to learn as much as you can at the onset of the process, you have to be careful about your sources of information. There is a lot of misinformation about bankruptcy that can hinder your best possible outcome. Flexer Law offers free consultations to first-time clients. This time can be used to find the best course of action based on your unique situation.
What Happens When You File Bankruptcy?
Organize Your Financial Records
The first step in the bankruptcy filing process is to compile a comprehensive list of your financial records. This includes assets, debts, expenses, and income. This brings clarity to the situation and paves the way towards the best course of action for you, your attorney, and (later) the trustee.
Complete Credit Counseling
With very rare exceptions, it is required that you receive credit counseling within 180 days of filing a bankruptcy petition. The reason for this is that the courts want to ensure that you have taken every step possible towards absolving your debts before turning to bankruptcy for the last resort. Flexer Law will help you to complete this required credit counseling.
Prepare and File Bankruptcy Petition
Once this is complete, the next step is to prepare and file a bankruptcy petition. While legal counsel is not a requirement of filing for bankruptcy, it is highly recommended. Representing yourself during such a complex process can put you in an unnecessarily risky situation.
Flexer Law consistently files more bankruptcy petitions than any other law firm in the Middle District of Tennessee. We practice law with understanding, kindness, and respect.
It is important to know which type of bankruptcy is best for your situation. There are many essential distinctions between Chapter 7 and Chapter 13 bankruptcies. Chapter 7 is also known as “liquidation”, and Chapter 13 is also known as “the wage earner’s plan”.
An experienced attorney will know which type of bankruptcy is right for you. They will also know the best way to fill out and file all of the associated paperwork. Minor errors can derail the entire process and negatively impact the outcome of your case.
Automatic Stay is Imposed
Once your petition is filed, an automatic stay will be imposed and a bankruptcy trustee will be assigned to your case. They will set up a creditors meeting, which you will have to attend. This meeting between you, your attorney, the court trustee, and your creditors will provide an opportunity for questions about the details of your case.
Chapter 7 Bankruptcy: Debt Liquidation
If you file for Chapter 7 bankruptcy, you may be absolved entirely from having to pay certain debts. In this scenario, you are able to keep certain assets but may have non-exempt property sold to repay creditors and court trustee fees.
This is where it pays to have an experienced attorney on your side. Learn more about Tennessee bankruptcy exemptions.
Chapter 13 Bankruptcy: Payment Plan
Chapter 13 bankruptcy requires that you repay certain debts in order to have others forgiven. This option is best for those with higher incomes and those that do not want to give up their non-exempt property.
In order to qualify for a Chapter 13 bankruptcy, the sum of your debts must not exceed a certain amount. This amount is periodically reevaluated but your attorney will know the current figures.
With Chapter 13, a 3-5 year plan will be structured for repaying your creditors. The remaining debts will be erased only after the payment plan is completed.
For more information, check out our article about keeping your car by filing for Chapter 13 bankruptcy.
Middle Tennessee’s Top Bankruptcy Law Firm
Regardless of which type of bankruptcy is right for your situation, enlisting the help of an experienced bankruptcy attorney to work on your behalf will provide tremendous value. It will ensure a smooth filing process and provide assurance that your petition is handled by a qualified legal professional.
Flexer Law has three office locations throughout Middle Tennessee to accommodate your legal needs. Contact us for a free legal consultation and we’ll find the best solution to help get your financial life back on track.