Personal Bankruptcy Filing: Is It the Best Way to Resolve Financial Problems?

Personal bankruptcy law enables, in some jurisdictions, an individual being declared bankrupt to be discharged from debts. Nearly every country with a functional legal system has some type of debtor relief for those adversely affected by personal bankruptcy. However, personal bankruptcy is distinguished from other forms of bankruptcy in the way it operates. Unlike corporate bankruptcy, personal bankruptcy is judged on its merits and not on the basis of assets that may not be exempt from repossession.

The most common types of personal bankruptcy are chapter 7 and chapter 11. In both types, the filing individual will have to pay back all outstanding loans. One of the common types of personal bankruptcy is a chapter seven bankruptcy. This means that the filing individual is declaring their inability to pay their debts based on their current and past income levels.

Chapter eleven bankruptcy, on the other hand, involves a court order that the individual declared their inability to repay debts. It is important that the individual involved taking this action as soon as they can. If they wait too long, it could result in their debts becoming automatic trusts, meaning that their debts become the property of the trustee who will collect them. Chapter eleven bankruptcy is the most difficult type of filing for this reason.

One of the most unique and interesting types of personal bankruptcy petitions filed by individuals is the type known as debtor’s petition. A debtor’s petition for discharge of their debts was developed to help the less than financially savvy file for bankruptcy. A debtor’s petition, also called a discharge petition, is filed in the same manner as other bankruptcy petitions. However, a creditor will not consider a discharge request until there has been a chapter discharge order.

For this reason, it is important to contact a competent bankruptcy lawyer if you plan to file a chapter discharge petition on your own. The process is complicated and time consuming and a bankruptcy lawyer will save you time and effort and protect your rights. A bankruptcy lawyer can also make the whole process go much smoother because he or she is familiar with the system and will be able to avoid many of the common pitfalls. When a person is considering filing for bankruptcy, they should remember to ask about the possibility of a chapter discharge, as well as what it entails. Choosing a competent bankruptcy lawyer can go a long way toward protecting your financial future.

If you are not sure whether you should file, a good idea might be to consult an experienced bankruptcy proceedings lawyer first. Many people don’t realize that they can file for personal bankruptcy proceedings without actually going through the court system. Bankruptcy proceedings only begin once a creditor files a complaint against you. For this reason, the process can be completed without ever entering court, which can make things much easier on the individual involved. A personal bankruptcy filing doesn’t have to be stressful, especially if the individual involved chooses to proceed without the help of an attorney.

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