A good bankruptcy attorney can help you get a fresh start by protecting your assets and discharging debts that aren’t necessary. They can also help you manage the process and avoid mistakes that could have long-term consequences.
Look for an attorney who specializes in bankruptcy or has extensive experience in the field. Then choose one who communicates clearly and understands your situation.
Filing for Bankruptcy
Bankruptcy is a legal process that allows you to wipe out some or all of your debts and give you a fresh start. Your attorney can explain bankruptcy law and procedures and help you complete and file the various forms. Once you declare bankruptcy, an automatic stay stops creditors from trying to collect on your debts until the court has sorted things out. This could save you from a foreclosure or repossession and prevent your wages from being garnished.
Chapter 7 bankruptcy liquidates your assets to pay off debts and may damage your credit, while Chapter 13 bankruptcy allows you to keep your property and repay some or all of your debts over a period of time. If you are considering bankruptcy, talk with a credit counselor or bankruptcy attorney first to explore other options that might be less expensive and do less damage to your credit record.
Filing for bankruptcy requires a filing fee, but you may be able to pay it in installments. You must also attend a meeting of creditors, where the trustee asks you questions. In most cases, you will be required to take a financial education course. Find approved courses at the U.S. Trustee Program’s website.
Preparing for Court
The process of filing for bankruptcy can be legally complicated, which is why it’s best to consult a lawyer first. Your attorney can determine whether Chapter 13 or Chapter 7 is your best option according to your financial situation. They can also help you weigh other options for debt relief, such as a debt management program or debt settlement.
During your initial consultation, your attorney will ask you about your financial history and what your goals are for bankruptcy. It is important to be completely honest with your attorney and don’t hide assets as doing so could violate bankruptcy law.
You should bring copies of your credit report and any other documents that show how much you own, such as mortgages, cars and other property. Your attorney may need to review your bank statements as well, in order to make sure you are not hiding assets from the court. You will also need to complete a credit counseling course, which costs around $50 but can be waived if you qualify.
Meeting with Creditors
The bankruptcy process includes a meeting with creditors, called a 341 hearing. The trustee assigned to your case conducts this meeting and asks you questions about the information you submitted in your bankruptcy paperwork. Creditors can also attend but rarely do, so this meeting is often short and fairly routine.
Before the meeting begins, you’ll need to raise your right hand and confirm under oath that you will tell the truth. You must answer all of the trustee’s questions, even if you think the question is irrelevant or unfair. Lying under oath is considered perjury and can have serious consequences.
Your bankruptcy attorney in Harrisburg PA may be able to prepare you for this meeting ahead of time and ensure that all the relevant information is included in your bankruptcy paperwork. He or she will also advise you about preserving certain assets and what tax consequences might occur. Creditors seldom show up at this meeting, and those who do often have a very good reason—such as an ex-spouse or disgruntled business partner.
Meeting with Your Lawyer
Talking with a bankruptcy lawyer can be a very emotional and stressful experience. You are essentially revealing your financial past to a stranger and opening up about a very difficult situation, but the right lawyer can walk you through this process. Look for an attorney who specializes in bankruptcy law, instead of a general practitioner, as these professionals are more familiar with the nuances of this particular area of law and are up to speed on the latest legal developments.
At your first meeting, your lawyer will likely request a range of personal information and documents. Don’t be embarrassed by these requests as your lawyer is only asking for this information to have a complete picture of your current financial situation. Having these documents prepared in advance can help your meeting move along more quickly and productively. It can also ensure that your attorney is fully prepared to assist you with your case. This includes determining the right bankruptcy Chapter for your specific situation and drafting your paperwork.
