Knowing What Questions to Ask
Preparing for bankruptcy is crucial, and asking your attorney the appropriate questions before filing is invaluable. First, consult your attorney to determine if you qualify for bankruptcy and, if so, for which sort. The distinctions between Chapter 7 and Chapter 13 filings are crucial to your case's overall success and financial future. Prior to filing for Chapter 7 bankruptcy, you must determine if you satisfy the eligibility requirements. In the event that you do not qualify, you may find Chapter 13 more appropriate.
Next, ask your attorney if your finances are in order. Changes to your financial history prior to filing can confound the filing process. Prior to filing, if you incur additional debt, pay down debts, or experience an increase in income, you may be disqualified. The general rule is to refrain from incurring new debts, paying off existing debts, acquiring additional income or an inheritance, or transferring assets in the 180 days prior to filing. Any of these actions could be considered suspect by the court and result in the dismissal of your case.
You may also wish to inquire about the disposition of your assets. It is crucial to determine whether any of your assets may be subject to liquidation in bankruptcy, particularly if you are registering for Chapter 7. Some of your assets are shielded from creditors by bankruptcy exemption laws, but you must determine which ones do not qualify for these exemptions. In addition, if you are attempting to avoid foreclosure or repossession, it is crucial to know whether Chapter 7 or Chapter 13 bankruptcy is preferable.
Finally, ask: What will my credit report look like following discharge? While declaring bankruptcy does not directly harm your credit, there are certain credit issues that must be resolved after your debts are discharged. It is essential to determine what is expected of you in terms of credit restoration after your case has been closed. You should monitor your credit for changes and ensure that the debt settlement is reflected on your credit report. To ensure the accuracy of your credit report, you may need to dispute information and request a status update. It is also crucial that you construct a post-bankruptcy credit plan that includes obtaining one or two small lines of credit to begin establishing a positive credit history.""
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