As a bankruptcy attorney, I know that individuals and couples go through several stages when they are answering the question “Should I file bankruptcy?” While most consumers follow a similar process when tackling this question, not every person will follow the same exact path to decide whether or not bankruptcy is right for them. This is because each person’s or couple’s financial situation is unique; however, through years of experience and by helping thousands of clients through the bankruptcy process, my partner and I have learned that most debtors go through at least three stages before deciding if they should file bankruptcy. While not all three steps are necessary, and many may skip to the last and most important step, there is some value in each of the following steps.

If you’re asking yourself this question, you may feel like you’re literally drowning in debt. You struggle to keep your head above water, but in fact, you’re barely staying afloat. If you’re feeling this bogged down with stress over debt, it’s time to take action. Consider the many benefits of filing a Chapter 7 bankruptcy. Many people dread the very thought of filing for bankruptcy, when in fact it is a positive way out to get a fresh start. Do not feel like a failure; you’re doing the right thing.

Constantly feeling like you are trying to catch up, while preventing yourself from falling further behind, is exhausting. The longer this drags on, the more tired and discouraged you become. Financial stress is known for causing personal health problems as well as relationship issues.

If your financial situation is spinning out of control and you are no longer able to make your full monthly payments on time, something needs to happen. Or, perhaps you are already in a debt management program and aren’t able to keep up with your already lowered monthly payments. There are two things that can be done.

A chapter 13 trustee will be assigned to your case when you file for bankruptcy. Think of the chapter 13 trustee’s role in your bankruptcy case similar to the role an account manager plays. This individual is appointed by the court and will manage your case from the beginning, through your entire repayment plan, at which time you will receive a discharge.

Two of the most common bankruptcy myths lead people to believe that you will lose everything you own and you will never be able to own anything in the future. Both of these are false. Most people who file bankruptcy don’t lose anything and in the future you can buy, own and possess whatever you can afford to make payments on. One of those necessary and often treasured possessions debtors fear losing is their vehicle – their mode of transportation.

A discharge is a legal term used during bankruptcy and refers to the elimination of your liability from your debts. If you file Chapter 7 your discharge will be granted immediately upon case closing or if you file Chapter 13, your discharge occurs after you complete your repayment period.

To initiate the chapter 7 bankruptcy process you must file a petition. Along with this petition you must file the following:

• Schedule of assets & liabilities
• Schedule of current income and expenditures
• Statement of financial affairs
• Schedule of executor contracts and unexpired leases
• Copy of the most recent tax year tax return or transcript
• Previous unfiled tax returns
• Tax returns filed during the bankruptcy case
• Certificate of credit counseling (copy of debt repayment plan completed during credit counseling)
• Evidence of payment from employers received 60 days before filing
• Statement of monthly net income (plus any anticipated increase in income or expenses after filing)
• Record of any interest in federal or state qualified education or tuition accounts
• Schedule of exempt property

Using a Bankruptcy Attorney to help you File a Chapter 13 Bankruptcy will be one of the best decisions you make, apart from your initial decision to get your life and finances back on track by filing bankruptcy. The bankruptcy code, court procedures and filing forms are saturated with legal jargon that will complicate the overall bankruptcy process if you don’t have the assistance from a legal professional. 

Your stress will begin to diminish the day you decide to file Chapter 7 bankruptcy. Taking action against your debts will take some of the pressure off – but taking action to abolish your debt completely will have you sleeping peacefully at night.

Filing for bankruptcy can give you a chance to start over financially. Knowing the correct information about this process and its potential results is absolutely necessary when considering whether or not to file. Bankruptcy is a legal proceeding, which means it is surrounded by legal jargon. This can make sorting through the massive amounts of bankruptcy related information complicated.

Debt consolidation consists of combining all of your unsecured debt payments into one. This may involve taking out a loan, entering into a debt consolidation program or Filing Chapter 13 Bankruptcy. Now, what are unsecured debt payments?