Why have I accumulated this much debt?  This is a question many people find themselves asking before the bottom falls out on their financial lives.  Most of the time the answer to why debt has been accumulated is I don’t know why.  It may have taken a bit of time before things began to become overwhelming and bills started to pile up without an end in sight.  Although maybe it is because a lay off recently took away your income.  The reason does not really matter at the point when you can’t make the payments and start to think about options for you financial future.

This is when many people start to explore debt relief options.  Options such as bankruptcy, debit consolidation, cleaning out 401ks and other financial investments are all valid however should be talked over with someone who can be trusted to give you wise financial advice and solutions.  The person you will most likely find yourself turning to is a bankruptcy attorney. The last thing you need at a time such as this is the stress of weeding attorneys out.  There are a few qualities to look for to find a trusted attorney to help you with your financial crisis.

Good bankruptcy attorneys should offer a free consultation to individuals seeking help especially with financial matters.  The last thing many people need to worry about at a time like this is the payment for meeting with an attorney.  When you are struggling with personal finances it is understandable that there is not room for extras before you meet with someone to consider options.

Another trait that is important when seeking out a law firm to help you through your financial struggle is finding an attorney who has experience and has been able to help previous clients.  Although a high success rate is not everything it does ease a bit of the stress to know you aren’t the first one and you won’t be the last.  As far as the length of time the attorney has been practicing look for over five years of experience in bankruptcy and financial cases.

Details are incredibly important when filing for bankruptcy.  An attorney specializing in bankruptcy should be known for meticulousness.  An attorney with a knack for details is well suited for bankruptcy cases.  There are many little details that need to be covered when calculating debt, income and determining means to pay or not pay.

It is important when dealing with a bankruptcy attorney that they are very empathetic and their demeanor is one that is helpful.  Even though they may have filed five thousand bankruptcies this is a first for the client.  They should be able to create a level of professionalism that lends to both their ability to be a hard-nosed attorney, looking out for the interests of his clients while representing them and a sympathetic ear for the stress level their clients are experiencing.

Financial issues are stressful on many levels.  Bankruptcy can take a toll on not only your finances but also your emotions. Once the bankruptcy process is free there is a good chance your debit will be wiped clean leaving you with few liabilities and limited assets.  It is a fresh start to begin controlling your financial life.  It will take effort and patience to determine a set financial plan.  Often times hiring a consultant is helpful to really create a meaningful budget and sticking to it to avoid debt issues in the future.

Chapter 7 bankruptcy is a common procedure for individuals seeking debt relief.  It is a legal process that allows individuals relief from overwhelming debt based on a meeting a set criteria.  Factors such as current income, amount of debt and the standings of their financial situation.  Debt situations can arise and burden individuals for a number of reasons; large medical bills, overextended credit and many other reasons.

When an individual decides that their debt has become overwhelming and declares bankruptcy they can expect the entire process to take about three to six months.  An individual may file bankruptcy once every eight years.

In order to file bankruptcy an individual must qualify and meet a standard of bankruptcy requirements. When individuals want to file for bankruptcy they must pass a means test first.  Individuals with income less than the state median for the state in which you live for a family the comparable size as yours qualify for chapter 7 bankruptcy.  Another means test is if you find yourself with an income greater than the median for the state but unable to pay one hundred dollars towards your debt for the next five years.  You will not qualify for chapter 7 bankruptcies if you make more than the median income for the state in which you are filing bankruptcy for a family the same size as yours and you have the financial means to pay one hundred dollars towards your debt for the next five years.  This is a good guideline to follow when looking into chapter 7 bankruptcy.  Otherwise you can look into chapter 13 bankruptcy.

During a chapter 7 bankruptcy assets are liquidated and sold to alleviate some of the debt you are responsible for to your creditors.  It is important to know that not all property has to be included in a chapter 7 bankruptcy some is exempt.  One of these exceptions is the homestead exception.  The homestead exception applies if there isn’t any equity in your home.  Under this circumstance you may keep the home and your current mortgage.  However, the payments on the home must be brought up to date before the bankruptcy hearing.

Another exception is a vehicle exception.  If the value on your vehicle is less than the remaining loan amount plus the allowed exception individuals may keep your vehicle.  Otherwise if the value is more than that amount you may be able to work out a deal with the bankruptcy trustee to actually buy the equity in the car yourself instead of someone else.

The final exception is a retirement exemption.   During a chapter 7 bankruptcy your retirement assets are not allowed to be counted towards your bankruptcy estate.  This protects pensions, 401k, IRA and Roth IRA accounts.

When filing chapter 7 bankruptcies there are certain debts that are unforgivable.  Typically trustees will not forgive debt associated with child support, federal and state taxes, HOA fees or debt accrued through student loans.  Even without these loans and debts being forgiven it is possible to catch up on them when individuals have been forgiven in other areas of debt.  Another reason debt would not be forgiven is if it was accrued during criminal activity or if injury or death was caused during the use of drugs and alcohol.  Any debt left off or neglected to be associated with the original filing of chapter 7 bankruptcy is also not forgivable.

The phone rings for the tenth time today.  It goes unanswered.  Creditors are calling.  There is absolutely not a dime to send them. What is the next step? What will make this nightmare end?  Chapter 7 bankruptcy might be the answer.  After loans have been consolidated, credit counseling obtained without any luck it might be time to review the facts with an attorney and get financials under control and in order.

Chapter 7 bankruptcy becomes a best fit option when credit card minimums start to become impossible to make, creditors are calling and debt collectors have started the cycle of harassment. When filing Chapter 7 bankruptcy the court orders an automatic stay which prohibits creditors from pursuing the debt any further.  The order of relief is needed in order to prohibit further collections from happening.

Chapter 7 bankruptcy takes a look at all debt and assets.  Trustees sell all nonexempt assets; this could possibly include homes, cars and large dollar item possessions and distributes the money amongst debtors.  It is possible that some assets will fall under a category known as exempt property.  Some homes that don’t have any equity and vehicles often fall into this category.

The Chapter 7 bankruptcy process is one that is fairly straight forward and simple.  The process starts out with a gathering of information.  This information includes the name and an address of people money is owed to, how much is owed along with information regarding incoming funds and monthly expenses.  Of course paperwork is involved and will need to be filled out and filed; this is often referred to as a petition or case file.  Then the paperwork will need to be filed in federal court.  An automatic stay is then issued by the federal court and all creditors must stop pursuing debt.

Then about twenty to forty days later the court will send notice of a 341 meeting which is attended for creditors to be able to dispute and question the claim.  Many times this process takes about ten to fifteen minutes to finish as creditors don’t usually stake claim unless at least fifty cents on the dollar can be recouped.  This is usually not the case in bankruptcy cases. After this is done the court will then accept the petition and sell of nonexempt assets to creditors and the debt will be wiped away in the form of a discharge sixty to ninety days later.  The next step is to rebuild a financial life to be proud of.

Filing for Chapter 7 bankruptcy is not a free service.  It is necessary to pay the fees involved in court expenses. There are case filing fees, miscellaneous expenses and trustee surcharges.  Although Chapter 7 bankruptcy can be filed on one’s own it is preferable to have an attorney represent the case.  This will prevent any mistakes from happening and to ensure all bases have been covered.  When dealing with a court of law and a fruitful financial future it is best to hire a profession bankruptcy attorney.