Figuring Out

A Beginner’s Guide to Filing a Bankruptcy Petition

Though bankruptcy is a word that you hear and see many times, chances are, you have no idea how to explain it in your own terms. So, what is the meaning of bankruptcy? When it comes to bankruptcy, one thing you should know about it is that it is a complex entity. Before you can file for a bankruptcy petition, there are certain legal steps that you must follow. Understanding the basic meaning of bankruptcy is one of the things that you should know before you push through in filing for a bankruptcy petition. So, one of the basic definitions of bankruptcy is that it gives you permission as a person with debts to escape from your financial obligations. There is no more need for you to pay off certain costs in full amount from your debts. To put things into perspective, you get a second chance from your debts when you file for this type of petition. Prior to getting out of your debts legally, keep in mind that you have a range of bankruptcy options to choose from.

Personal bankruptcy makes up the most basic kind of bankruptcy. In bankruptcy codes, this is the Chapter 7 or Chapter 13 bankruptcy. For the former type of personal bankruptcy, the person has to dispose of most of their assets. So that you can pay your creditors, the cash from your assets will be split among them. On the other hand, the second kind of bankruptcy entitles the person to take hold of most of their assets. For individuals to make appropriate repayments using this option, they should stick with a three- to five-year repayment plan.

Another type of bankruptcy option is business bankruptcy applicable to business owners. If you are unable to make your business repayments on time, then you can file for this type of bankruptcy. In this case, you can consider filing for either Chapter 7 or Chapter 11 bankruptcy. Chapter 11 bankruptcy is similar to Chapter 13 wherein the court allows your business to follow a repayment schedule.

When you file for bankruptcy, you can avail certain exemptions. For example, there are some federal and state exemptions that enable individuals to still file for bankruptcy yet still keep most of their private assets and belongings. Some of the things that these people can still own include their property, occupation tools and equipment, and the truck or motor vehicle that they own. Some states still enable people to get their benefits like survivor’s, retirement, and death/disability benefits.

There are still some financial obligations that you have to pay for even if you file for a bankruptcy petition. Charges that the judge orders for you to pay as well as taxes are some of these obligations. There are particular debts that your creditors can also dispute. In these instances, the case goes to court, and the verdict will be made upon by the judge.

Why No One Talks About Anymore

How I Achieved Maximum Success with