Bankruptcy has a lot of myth and mystery surrounding it since it can be such a complex process and since there is a stigma around it that makes people less likely to talk about it. Changes in the rules have also caused some confusion and the spread of misinformation. Therefore, you may be thinking about filing for bankruptcy but unclear about what will happen after you do.
Chapter 7 bankruptcy is what’s known as a “total liquidation” bankruptcy. With it, you will be able to discharge most unsecured debts. Here’s what you need to know about what will happen after you file for Chapter 7 bankruptcy in Gilbert:
An Automatic Stay will be Issued
As soon as you file for Chapter 7 bankruptcy in Gilbert, an automatic stay is issued that prohibits your creditors from contacting you or from continuing to try to collect on a debt. You will immediately attain relief from harassing phone calls at your home and work, and you won’t get any more mailings asking for you to pay.
If you are contacted by any of your creditors after filing for bankruptcy, you should refer them to your Gilbert bankruptcy attorney for questions. In most cases, this contact is a simple mistake, and you won’t get another call after that.
Liquidate Most Debt
Chapter 7 bankruptcy in Gilbert allows you to liquidate most unsecured debt if you qualify to file, including credit cards, medical bills, and personal loans (except those that are backed by collateral). There is no limit on the amount of debt you can discharge.
You can expect your bankruptcy attorney to go through all of your debts with you to help you understand which debts will be discharged in the bankruptcy and which will be exempt. Your attorney will create a comprehensive report for the bankruptcy trustee.
Potentially Liquidate Assets
You can’t just declare that you can’t pay and then be freed of your obligations to your creditors. The bankruptcy trustee must first determine if you are able to pay your creditors, even in part. To do so, the trustee looks at not just your income but also your assets. Sure, you may have lost your job and have zero income to report, but you may own a $5 million house, so absolving you of debt just wouldn’t be fair to your creditors.
However, the bankruptcy court also recognizes that you need a home to live in and a car to drive to get to work and furniture to fill your house, and so on. You are not expected to be left completely penniless and deprived in order to declare bankruptcy. Bankruptcy law allows exemptions for personal assets. You get a certain amount of equity for your house, your car, and your personal possessions. So long as they do not exceed this threshold, you will be allowed to keep them.
Resolution in Just a Few Months
By working with a Gilbert bankruptcy attorney, you can get your Chapter 7 bankruptcy filing resolved in a matter of months. That means that you’ll be able to work on rebuilding your finances quickly to get your life back to where you want it.
A dedicated attorney can put together your filing quickly and ensure that it is completed properly so that it makes it through all the stages of the bankruptcy process quickly. Your attorney will see to it that you don’t hit any roadblocks along the way, if at all possible.
Chapter 7 bankruptcy in Gilbert offers an effective way to rid yourself of crushing debt and to start putting back together the pieces of your crumbling finances quickly. You are legally allowed to file for bankruptcy on your own, but you should always work with a bankruptcy attorney to ensure that you aren’t making any mistakes that could threaten your petition or even lead to legal consequences.
Gilbert Bankruptcy Lawyers are ready to help you if you are thinking of filing for bankruptcy in the Gilbert area. Our attorneys will closely review your financial situation to help you understand how bankruptcy might help you, and if so, whether Chapter 7 bankruptcy or Chapter 13 bankruptcy in Gilbert would be the better choice for you. Our bankruptcy attorneys are patient and compassionate, and they will walk you through every step of the process so that you are informed and able to make the best decisions to meet your goals. Call us in Gilbert today to schedule a consultation with a bankruptcy attorney.