When you need to consider bankruptcy, you need to take into account all of the ramifications of such a decision. One of the most important decisions you will make is who will represent you in court. The choice of an attorney is critical, so you must select the right one for your specific situation. Discover the steps of hiring a bankruptcy attorney so that you can make an informed decision.
1. Determine Which Type of Bankruptcy Is Appropriate for Your Situation
Individuals can file one of two types of bankruptcies: Chapter 13 and Chapter 7. To decide which kind of bankruptcy is right for you, you need to understand how the two are different.
Chapter 13 Bankruptcy
Chapter 13 bankruptcy, or reorganization bankruptcy, allows individuals to repay some or all of their debts over a period of time, usually three to five years. To meet the requirements for Chapter 13 bankruptcy, you must have a regular source of income, and your unsecured debt cannot go beyond $419,275. Once the repayment plan is complete, the court will discharge your unpaid dischargeable debt. Chapter 13 is used by many to halt foreclosures, make up missed house payments, stop tax levies, and pay back pay taxes.
Chapter 7 Bankruptcy
Chapter 7 bankruptcy, or liquidation bankruptcy, allows individuals to discharge their dischargeable debts. The trustee may ask for turnover of their nonexempt assets to sell and partially pay creditors. To be suitable for Chapter 7 bankruptcy, your income must be under the median income for your state or you, otherwise must pass a means test.
Once you have determined which type of bankruptcy is right for you, you can begin the process of finding an attorney.
2. Get Recommendations From People You Trust
Need recommendations for a suitable attorney? Ask anyone who has gone through bankruptcy, or check with your local bar association or the American Bankruptcy Institute for a list of attorneys in your area.
3. Schedule Consultations With Potential Attorneys
Most bankruptcy attorneys offer free consultations, so be sure to take advantage of this. During your consultation, ask about the attorney’s experience, fees, and their recommendation about whether they think you should file for Chapter 7 or Chapter 13 bankruptcy.
4. Select an Attorney
Your attorney will need to see your financial records to determine if you are eligible for bankruptcy. You will need to provide your attorney with copies of your pay stubs, bank statements, tax returns, and credit card statements.
Once you have gathered all of the necessary documentation, your attorney will begin filing for bankruptcy.
5. File for Bankruptcy
The first step in the bankruptcy process is to file a petition with the court. The petition will list all of your debts and assets. After the petition has been filed, the court will notify your creditors, and they will have an opportunity to object to the bankruptcy.
The next step is to attend a meeting of creditors. This meeting is also known as a 341 hearing. At this hearing, your creditors will have an opportunity to ask you questions about your assets and debts.
For Chapter 13 cases, after the meeting of creditors comes a confirmation hearing. This hearing is where the bankruptcy judge will decide whether or not to confirm your repayment plan. If the judge confirms your repayment plan, they will require you to make monthly payments to your trustee.
Once you have completed the bankruptcy process, the court will discharge your remaining dischargeable debt, and you will be able to start fresh.
If you have considered filing for bankruptcy, contact Wiesner & Frackowiak, LC, today to schedule a free consultation. Our experienced bankruptcy attorneys can help you determine which type of bankruptcy is right for you and guide you through the process. Call us today to get started. We are happy to help you!