Whenever someone is thinking of filing bankruptcy, a good place to start learning about bankruptcy is the bankruptcy FAQ. A bankruptcy FAQ usually outlines basics information about how to file bankruptcy, different types of bankruptcy such as chapter 7 bankruptcy or chapter 13 bankruptcy as well as common questions that people ask about the subject.
The first question that comes to people's mind on the subject of bankruptcy and often the first question in a bankruptcy FAQ is how to file bankruptcy. Knowing how to file bankruptcy properly will avoid many problems that can result on a legal standpoint. The first step of filing bankruptcy is to file a petition and then pay all the needed fees such as administrative fees and the filing fee.
It is important to know what type of bankruptcy is the most suitable for which situation. A bankruptcy FAQ will distinguish between chapter 7 bankruptcy, chapter 13 bankruptcy, chapter 11 bankruptcy for business reorganization and even chapter 12. Choosing the type of bankruptcy to file is important and bankruptcy FAQ will provide lots of useful information.
Chapter 7 bankruptcy used to be the most desirable and the most common form of bankruptcy. However the new bankruptcy laws make it harder for people to qualify for chapter 7 bankruptcy so many people file chapter 13 bankruptcy instead. Also, with chapter 13, debtors can keep their assets instead of having to liquidate them all as in the case of chapter 7 bankruptcy.
A bankruptcy FAQ will not fail to mention chapter 13 bankruptcy in detail. Chapter 13 bankruptcy is all about repayment plan. In stead of putting all assets at the disposal of the bankruptcy trustee to liquidate and then pay creditors, debtor can come up with a repayment plan and keep the assets. Debtor seeking chapter 13 bankruptcy will have to prove that he/she has enough income to pay creditors.
An important question in a bankruptcy FAQ is the cost of filing bankruptcy. Some people think it costs a lot to file and they simply cannot afford to file for bankruptcy. However, in fact it only costs a few hundred dollars to file and pay the necessary fees if you file bankruptcy yourself. If you hire a lawyer, however, the cost can escalate dramatically.
When filing bankruptcy, do not expect all debts to go away. Some debts will not be discharged even when the debtor files bankruptcy. Taxes and guaranteed student loans for example are usually not discharged. The bankruptcy laws involving what debts are discharged and what are not are very complicated.
There are so many questions about bankruptcy that a person seeking to file bankruptcy needs to know. A bankruptcy FAQ should give an overview of filing bankruptcy as well as answers important questions that most people have encountered. Do not file bankruptcy if you have other options.
About the Author:
This page is just a sampling of the many Bankruptcy FAQs that we have put together and answered over at the free Bankruptcy Laws resource site. Come by today to learn the answer to your bankruptcy questions!
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