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What Do I Need to Know About Bankruptcy?

What Is Bankruptcy

Bankruptcy is a financial maneuver undertaken by individuals in the midst of financial insolvency. When a financially-distressed person files for bankruptcy, the individual is formally attempting to consolidate or mitigate their exposure to debt. The stage prior to the filing of bankruptcy is also called financial insolvency. In the event of financial insolvency, an individual or a business can apply for the filing of bankruptcy, which primarily exists in two forms: liquidation and restructuring.

A bankruptcy attorney can assist in this process by not only determining if bankruptcy is the most viable option for their respective client, but also - in the event that an individual or business chooses to declare bankruptcy - in the compilation of a financial statement, and in completing the legal forms and documents.

Because the process of declaring for bankruptcy is typically more trying than the filing itself, the inclusion of a bankruptcy lawyer is highly recommended. These professionals, who are experienced with both bankruptcy code and the procedural rules required for the filing, will ultimately expedite your quest for financial freedom.

A fear that plagues many people who undergo financial insolvency, a situation in which bankruptcy might present itself as the only viable remedy, are the assumed and implicit societal judgments on them. In order to complete the process of filing for bankruptcy, the outstanding debt must be paid to fullest extent.

The counsel and guidance of a bankruptcy attorney aids in this process to provide greater efficacy to your case. Not only will an experienced a bankruptcy attorney oversee the liquidation process, but these legal professionals will also help their clients retain certain assets that sentimentally or inherently valuable.

Oftentimes, circumstances that prompt the onset of bankruptcy are not only unforeseen, but also unwelcome. A personal bankruptcy lawyer is a legal professional who carries a vast array of legal acumen in tandem with an overarching understanding of the multi-faceted legal statutes that exist in the field of bankruptcy law. A business bankruptcy lawyer will suggest the type of bankruptcy to claim that will be of the utmost benefit of everyone involved.

In a majority of cases, Chapter 7 bankruptcy or Chapter 11 bankruptcy will be utilized by businesses. Chapter 7 bankruptcy is the liquidation of all assets and funds in order to repay all outstanding creditor-owned debt to the fullest extent. Chapter 11 bankruptcy involves the complete reconstruction of a business, thus allowing it to remain in operation while repaying outstanding debts.

Similar to a Chapter 11 bankruptcy (restructuring of a business with the intent of repaying debts to respective creditors) a Chapter 13 filing maintains uniform expectations; however,it is only initiated in a private manner by unincorporated individuals.

A bankruptcy attorney will express understanding, as well as an ability to listen to the facts in a non-assuming fashion. They will apply their knowledge and legal acumen with the hopes of providing for the best interests of their respective clientele.

In many cases, bankruptcy is not a choice nor an ideal situation, but a financial and personal hurdle to overcome. With the assistance of an attorney, the process of filing for bankruptcy can be completed in the most informed, honest, legal, and objective means possible.

NEXT: Chapter 7 Bankruptcy Information

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