Things to Know Before You File Bankruptcy

Bankruptcy provides a great way to discharge your debts and get a new start in your financial life. However, many people considering bankruptcy do not entirely understand how the process works. Unfortunately, getting your debt discharged is not as simple as filling out some forms and waiting to hear the court’s decision. If you have been thinking about filing bankruptcy, below are five things you should know first.

The Process Takes Time

In some civil courts, such as small claims, the legal process is relatively fast and a case can be resolved in as little as one day. The bankruptcy courts, though, do not operate in the same manner.Chapter 7 is the most common type of bankruptcy filed by consumers and it is also one of the quickest ways to get debt discharged. Still, the average Chapter 7 case can take anywhere between four and six months.

A Chapter 13 bankruptcy, the second most common type, will take much longer than a Chapter 7 bankruptcy. During Chapter 13 bankruptcy, a borrower’s debt is organized into a repayment plan, although some of it may be entirely discharged, as well. These repayment plans can span anywhere between three to five years, so it can take some time before a case is entirely resolved.

Bankruptcy Cases Become Part of Public Record

Court records become part of the public record, which means that the details of your bankruptcy case are also available to the general public. The vast majority of people do not spend time searching through the financial records of people they know, so this is not a concern for most people. However, if you have financial matters you would prefer to keep confidential, this is an important consideration to keep in mind.

Only Your Debts are Discharged

You can file bankruptcy on an individual basis or, if you are married, you can file jointly with your spouse. Whichever one you choose, the bankruptcy will only discharge the debts of the individuals named in the petition. This means that if you have co-signed or otherwise guaranteed the repayment of debt for another person, they are still responsible for that debt. If they do not pay it, you will still be responsible for covering the amount owed.

Bankruptcy Stops Collection Calls Right Away

Most people know that when they are successful in their bankruptcy case, they can discharge the debt they currently owe. Many people do not realize, though, that filing bankruptcy can stop debt collection calls right away. Once you file your petition, an automatic stay is issued by the courts. This does not eliminate your debt, but it does stop creditors and debt collectors from making collection attempts until your case is finalized.

A Bankruptcy Lawyer in Orlando Can Help with Your Case

You are not required to work with an Orlando bankruptcy lawyer when you file, but it is always highly recommended. At The Benenati Law Firm, our skilled attorneys will review the facts of your case, advise you of your legal options, and help you determine which type of bankruptcy is right for you. Call us now at (407) 777-7777 or contact us online to schedule a free consultation.