Business World

Steps on Filing for Chapter 7 Bankruptcy

Filing for Bankruptcy in ProvoFiling for bankruptcy is one of the most practical ways to tackles issues with your huge debt. This option provides relief from financial circumstances and helps people have a fresh start.

Chapter 7 is the most commonly filed types of personal bankruptcy. It is a court-supervised process where you get rid of your personal liability for certain types of debt. The entire process may be complex, but things are much easier when you get legal advice. Attorney offices and law firms specializing in bankruptcy in Provo can guide you through the entire process.

Here’s a short guide to filing Chapter 7 bankruptcy.

Is it the right choice?

The first thing to do is determine if filing for bankruptcy is the best option. Remember that it can take a toll on your future credit. It’s practical to file if you cannot, in any way, repay major debts such medical bills and auto accident claims.

Are you qualified?

Know if you are qualified to file for Chapter 7 bankruptcy. Your qualification depends on your income. The courts will find out if your income is not enough to cover your debts. A Chapter 13 debt consolidation could be the next best option if you’re not qualified.

Redeem, reaffirm, or surrender?

Decide whether you want to redeem, reaffirm, or surrender properties pledged as collateral. If you redeem, you’ll pay the creditor the property’s current replacement value. Reaffirming means you agree with the contract terms. Surrendering simply means the creditor takes your property.

Are there disputes?

The next step is to fill out forms. You need to attend a court meeting with the creditors and trustee. This is to review your case and clarify information in the forms. Address disputes concerning creditor’s claim.

Are you there yet?

Complete a form stating how you plan to handle your secured debts. When all forms are submitted and the case is closed, you’ll receive a court order saying the applicable debts are officially discharged. This means you no longer have a legal obligation to pay those debts and the creditors no longer have a legal right to demand such.

Seek legal help for a smoother and a more successful filing.