Useful Bankruptcy Facts to Know Before You File for Chapter 7 or Chapter 13There are many bankruptcy facts that you need to discover prior to submitting your petition to the bankruptcy court. Although you may be concerned by the public perception, going bankrupt is often the best debt free solution when your unsecured liabilities are out of control. You can clear medical bills, credit cards debt, unsecured loans and repossession deficiencies by filing for bankruptcy under chapter 7 or chapter 13.
Filing for bankruptcy isn't suitable for everyone as not all forms of personal debt can be eliminated. Those who have defaulted on student loans will not be able to free themselves from debt. Neither will individuals who wish to write-off taxes owed to the IRS (other than income tax), escape fines for criminal offences or avoid alimony and child support payments. There is bankruptcy protection for car loans in many cases. Be sure to consult a professional about this matter. Establishing all the bankruptcy facts is essential if you are to comply with the Bankruptcy Abuse Prevention and Consumer Protection Act of 2005. You will need to have an income below the state median and hand over any non-exempt assets to a court-appointed trustee. However, chapter 13 may provide a far better alternative. Doing your research now will help you to reap the rewards later on. 
Although an attorney will be able to provide the answers to bankruptcy questions, the 2005 laws were introduced to prevent people filing under chapter 7 when their financial position meant that they were able to offer some payment to creditors. However, those who qualify under chapter 7 can eliminate all debts in just 4 months.Filing chapter 13 involves making a monthly payment to a trustee for a 3 or 5 year period. The 3-year period will apply if you qualify under the means test for the 2005 code. At the end of the defined term, any remaining debt will be completely written-off. If you're unable to comply with the chapter 7 rules, this is the preferred option. The same court protection is offered to the debtor throughout. Prior to filing for bankruptcy, it's necessary to get all of the latest bankruptcy facts from a qualified debt counselor. This is to ensure that you don't rush into a decision that you'll later regret. It also allows you to start your new life afresh. Find out all the bankruptcy facts to see if chapter 7 or chapter 13 is the best debt solution for your needs.
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