What to Know Before Filing for Bankruptcy

Are you considering filing for bankruptcy but don’t know where to begin the arduous process of declaring Chapter 7 or 13? At DeLuca & Associates, our goal is to provide clients with all of the information necessary to help them move on from their monetary issues and start life anew, free from their previous financial woes. Get the facts before you start filing for bankruptcy with this helpful guide that will put you on the right path to financial freedom.

Chapter 7 vs. Chapter 13: What’s the Difference?

The first thing you should know is that individual people can file for either Chapter 7 or Chapter 13 bankruptcy. Chapter 7 erases all debts through a liquidation of assets, wiping out unsecured debts like medical bills and credit cards. You can keep secured property if you are current on your payments and if you plan on continuing to make payments, but a trustee will be appointed to sell any nonexempt property in an attempt to pay back your creditors. Most Chapter 7 bankruptcy cases take several months to complete, but not everyone is eligible to file for this type of bankruptcy. If you make more than a set amount of money, you may be forced to file for Chapter 13.
Chapter 13 bankruptcy allows you to retain valuable assets (such as homes or cars), so long as you can make the necessary payments. While this type of bankruptcy can take three to five years to complete, none of your property is liquidated and most of your unsecured debts will be discharged. A payment plan will be set up to ensure your creditors are being paid on time, requiring a monthly income to make regular payments. If your unsecured debts exceed $383,175 or your secured debts are more than $1,149,525, you are unable to file for Chapter 13 bankruptcy.

How Long Will It Take to File?

Chapter 7 bankruptcy cases are typically completed 4 to 6 months after filing, while Chapter 13 bankruptcies can take anywhere from three to five years to complete the payment plan. Filers usually have to attend court just once for a “meeting of creditors” and the courts often charge a fee for filing. These fees cannot be waived and will be required to be repaid within a reasonable amount of time after filing for bankruptcy. You’ll also have to pay applicable attorney fees and stay current with your payment plan to exit bankruptcy unscathed.

Bankruptcy and Your Credit Report

A bankruptcy filing will remain on your credit report for 10 years. This doesn’t necessarily mean it will be impossible to get credit during those 10 years, but you’ll likely have to pay a higher interest rate than people who haven’t filed for bankruptcy. It is important to keep in mind that the law prohibits employers and government agencies from discriminating against individuals who’ve filed for bankruptcy.
While kits exist for people to file for bankruptcy themselves, you should refrain from using one as each bankruptcy case is different and you could lose valuable property or rights if you’re not well-informed. It is wise to consult with an attorney to help you determine which type of bankruptcy you should file and to help you figure out the best possible plan for getting out of financial trouble. A qualified and knowledgeable lawyer will help you fill out all necessary paperwork, allowing you to rest easy knowing that your bankruptcy case is in the hands of a professional.

Bankruptcy Help in Las Vegas

When looking for the best bankruptcy attorney in Las Vegas, ask if a fee is associated with the initial consultation and how experienced the attorney is in handling bankruptcy cases. Be sure to find out how much the attorney’s representation will cost and what services are included. Also, make sure to get all of this information in writing. For more information on Chapter 7 or 13 bankruptcy cases, contact DeLuca & Associates today at (702) 872-3280.