Bankruptcy Filing – A Convenient Option To Overcome Debt Crisis

No matter how challenging it is to cope with a severe debt crisis, appropriate advice and guidance from a reliable source can help you immensely. During times when you are too overwhelmed and confused with your monetary problems, a knowledgeable attorney can provide proper guidance regarding the course of action that needs to be followed. There are actually several debt solutions available for individuals facing financial trouble. The right one, of course, has to be chosen in accordance with individual financial situations, requirements and conveniences.

Bankruptcy, among the various debt solutions, is one of the most common and significant one. For individuals who are incapable of paying off heavy debt amounts, a bankruptcy filing can be a convenient option. Though there can be various negative impacts of this particular process, individuals can sometimes benefit immensely by opting for it in certain circumstances. Let us discuss is brief some of the advantages of choosing it as a debt solution:

The moment an individual is declared bankrupt; their creditors are immediately notified and instructed by the court to stop all direct contacts with them. This relieves the debtors from the constant harassments made by the lenders for the money.
Once an individual files for bankruptcy, all their credit cards and bank accounts gets closed, which can undoubtedly be intimidating for most people. However, by clearing all past financial records, it surely makes way for a new beginning.
A court order known as automatic stay, which becomes effective, the instant an individual files for bankruptcy helps immensely in dealing with foreclosure. It helps in putting off the foreclosure either permanently or for a definite time span.

In case bankruptcy is the most suitable option in your situation, there is certain information that you must have:

It can either be filed in the court by the debtor readily in order to obtain relief from the debt burden, or can also be filed by the creditors to declare the debtor as bankrupt. Once the petition is accepted, the court acts as a medium between an individual and their creditors, thereby providing the debtors an opportunity to make a new beginning, and make payments with as much convenience as possible.
It is a compulsory rule for individuals to complete a credit counseling course, and submit the completion certificate with the court during bankruptcy filing. This course has to be completed under the guidance of a licensed credit counselor.
Completing a means test is also essential for a successful filing in order to prove that an individual’s annual income is not more that the median income for their family size in their state.
For personal bankruptcy, an individual need to provide the court with certain essential documents such as a list of their creditors, information on current income and personal expenditures and photo identification. Other documents that need to be submitted include bank records, a copy of a paycheck, a pay stub, rental agreements and all other documents received by individuals as proof of their income and expenditures during the last six months prior to the bankruptcy filing.

There are various forms of bankruptcies that have to be chosen on the basis of individual financial circumstances.