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Filing for bankruptcy gives you a chance for people to relieve themselves of debt, or for businesses to use to repay or erase debts, and if you need help with chapter 7 bankruptcy, you need an experienced and qualified lawyer on your side. There is no guarantee that your discharge will be accepted, but in the majority of cases, debtors are afforded some tax relief, to help them get a fresh start. Here are four commonly asked questions that you need to know about before you make any decisions: 1. Who Is Eligible For Chapter 7 Bankruptcy? Filing for chapter 7 bankruptcy is open to any individual debtor, partnership or corporation that needs to address their debt. By contrast, a chapter 13 bankruptcy is only made available to individuals. 2. Which Debts Are Eligible? Most debts are covered when filing for chapter 7 bankruptcy. The most common debts include personal loans, medical bills, credit card accounts, judgments, and repossession debts. There are some exclusions, though: fraud, child support, taxes and student loans are not covered. Debts that have arisen as a result of you committing a personal injury against someone else are also exempted from the process. 3. Can You Keep Ownership of Your Home? There is a chance your home will be lost under certain conditions but some people are fortunate enough to be able to keep theirs, selling other assets to raise the money for outstanding debts. Working with an attorney who has a good track record of successful outcomes will boost your chances of a favorable conclusion. You might lose it if you have a certain amount of equity or if you are not in a position to afford your monthly mortgage repayments. Also, if your equity is more than your homestead exemption, you might also run the risk of losing your property. For people who do run the risk of losing out on their properties, it might be worthwhile investing a chapter 13, which if successful, could allow you to keep your home. 4. Does Filing Bankruptcy Affect My Credit Rating? Yes, your credit rating will be affected negatively, but most people find they can recover from it in a few short years. If you are thinking of filing for bankruptcy, your credit rating is likely to have been affected already, so it is worth taking the time out to restructure your finances and rebuild your future, literally starting from a clean slate.
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