Before Filing
This is perhaps the most crucial aspect of debt management. Choices can be overwhelming when you are confronted with the decision of how to manage your debt liabilities in the midst of financial hardship. Debt negotiation, settlement, and consolidation are options for finding relief; however, if the nature of your debts is alarming, you should consider bankruptcy immediately. In other words, you should consult with a bankruptcy attorney immediately if you are at risk of losing assets, are incurring more credit card debt to cover essential living expenses, or do not expect your financial hardship to improve within the next few months.
During Bankruptcy
If you choose to declare bankruptcy, you can breathe easy knowing that time is no longer working against you. As soon as your petition is filed, the court issues an automatic stay order. This order promptly suspends all collection efforts, including repossession, wage garnishment, and foreclosure. At this stage, your debts are not yet settled, but you will no longer experience the anxiety associated with the prospect of collections.
Your creditors will be notified of the automatic stay order and your active bankruptcy case once it has been issued. At this juncture, the court will initiate the process of developing a plan to settle your debts. Depending on the form of bankruptcy you file, your Chapter 7 debts may be discharged through creditor write-offs or the sale of non-essential assets. Otherwise, the court will create a repayment plan for you as part of a Chapter 13 case. As long as your case is pending, the automatic stay will protect you from creditors and require them to comply with the court-ordered payment plan.
After A Discharge
Once your case is concluded and you receive a discharge of debt, the automatic stay order on those debt accounts becomes permanent. However, not all debts will be granted permanent immunity from future liability. After a discharge, a debt may still be collectible for three reasons. First, if the debt was never eligible for discharge, as is the case with domestic support payments, certain tax debts, and student loan debts, creditors will be permitted to resume collection efforts. If the debt was reaffirmed as part of an agreement between you and the lender to recommence payment after the discharge, your creditor can sue you. Last, if a jointly held debt was discharged for only one member of the jointly liable party, the other member could be held fully liable for the debt's balance.""
" - https://www.affordablecebu.com/
