Four Facts about Bankruptcy in the United States

How to file for bankruptcy

For people unfamiliar with financial laws, knowing when to file bankruptcy, or if you are qualified to do so, can be confusing. However, filing for bankruptcy can be a way for you to have a fresh financial start if you feel overwhelmed with debt.

Here are the four facts you need to know about bankruptcy law in the United States:

1. Chapter 7 bankruptcy: Chapter 7 bankruptcy is for individuals who are unable to pay their existing debts. A Chapter 7 bankruptcy attorney can work with individuals who are seeking forgiveness of their debt. However, Chapter 7 bankruptcy also requires an individual’s assets to be liquidated and sold. Certain exemptions can be made in the liquidation, such as one’s house or personal items.

2. Chapter 13 bankruptcy: A Chapter 13 bankruptcy attorney is qualified to represent individuals with regular incomes who seek a reorganization or their debts and a reconfiguring of their debt repayment plans. An attorney can provide you with more Chapter 13 bankruptcy information and let you know how to file for bankruptcy.

3. Chapter 7 bankruptcy and Chapter 13 bankruptcy are the most common types of bankruptcy in the United States.

4. Filing for Chapter 13 or Chapter 7 bankruptcy will reflect negatively upon your credit score, and while they can stay on your credit report for a long time, regularly paying your bills and loan payments can help you re-establish a good credit score. Great references here: