File Bankruptcy and Take Control of Your Debts Once and For All

Bankruptcy was created to provide honest hard working individuals a way to eliminate overwhelming debt and gain a fresh start. So why do many people see filing bankruptcy as a failure? Most of us were raised to honor our responsibilities and many people feel that having to file bankruptcy is like admitting that you have to give up and walk away from your obligations. The credit industry also has a big role in this negative stigma as well. The creditors will tell people that they are losers, failures, and that they will go to prison if they don’t pay back their debt. The truth is, the majority of people that have to file bankruptcy agonize over the decision. Many have run into unexpected circumstances such as a job loss, medical illness, or divorce that have forced them into filing bankruptcy. When someone is facing the choice of paying their bills or putting food on the table for their family the decision becomes clear. Fortunately these days the scarlet “B” of bankruptcy no longer carries the mark of shame that it once used to. Millions of Americans every year file for bankruptcy including actors, singers, and athletes. It is common for corporations to file bankruptcy as a way to restructure, reorganize, and emerge leaner.

The Chapter 7 Bankruptcy process is fairly quick and straightforward. It begins when the bankruptcy petition is filed with the bankruptcy court. A trustee will be appointed to the case and the date for the creditors meeting will be set. The trustee basically oversees the case and makes sure that everything is in order, and that the creditors get paid as much as possible if there is anything that is not protected in the bankruptcy. This is determined by the bankruptcy exemption laws which vary from state to state. Typically in a Chapter 7 Bankruptcy the debtor does not lose any property since most states have generous exemption laws that cover personal property. When the meeting of creditors date arrives, the debtor will attend the meeting with their bankruptcy attorney at the bankruptcy court. Many people are intimidated at the thought of the creditors meeting and being confronted by angry creditors. However, it is rare that any creditors ever attend this meeting unless fraud on the part of the debtor was strongly suspected. In the meeting the trustee asks the debtor some questions regarding their petition, assets and debts. The hearing generally only takes about 10 minutes and the debtor is released. The debtor then awaits their bankruptcy discharge in the mail.

For many people that feel that having to file bankruptcy is a failure, they should look at the big picture. When someone is drowning in debt and it is affecting their life, their family, their relationships, their health, and their credit rating, then filing for bankruptcy just might be the smartest decision they can make to take control of their finances and get them back on the road to recovery.