By claiming bankruptcy, individuals may be able to rearrange their finances to create a more successful future for themselves. Although filing for bankruptcy can be a scary process, it can prove to be quite beneficial. With the requirements for eligibility, individuals can become more educated about their finances and how to handle transactions in the future. This can help them avoid financial ruin in the future while prepping them on how to improve their current situation.
The automatic stay is a tool used in bankruptcy proceedings that can be seen as beneficial for individuals going through the process. With the automatic stay in place, creditors will be barred from contacting those that are claiming bankruptcy. No more phone calls about debt that you have accrued over time. This can relieve some of the stress that individuals are facing. By avoiding the harassment of creditors, it can focus your efforts on a repayment plan and how to solve your situation’s problems.
When is the stay put in place?
Individuals who file for bankruptcy can go through Chapter 7 bankruptcy or Chapter 13 bankruptcy. With these processes, they may be able to create a better financial future for themselves. Upon filing all the paperwork that is required for bankruptcy proceedings, the automatic stay will go into effect. After the filing is done and the automatic stay goes into effect, individuals have more tasks to complete.
What comes after the automatic stay?
Chapter 7 and Chapter 13 processes are both used for individuals who are claiming bankrutpcy. However, these processes have some differences. After the automatic stay goes into effect for Chapter 7 bankruptcy, a bankruptcy trustee is put in charge of your assets. This trustee will make decisions on assigning a value to your property and using your assets to pay as much of your debt as possible. A meeting of your creditors occurs as well. This is is when you, your attorney, creditors who wish to attend and your trustee will discuss your situation. At this meeting, creditors can compile information to reject the case.
Chapter 13 bankruptcy continues with the formation of a repayment plan. This may only be possible if you have a steady income. The repayment plan can be over a period of three to five years where you pay creditors back a steady stream instead of a lump sum.
If you require the services of an experienced Business Law or Bankruptcy attorney, contact the Law Offices of Allen A. Kolber, Esq. today to schedule a consultation and discuss your options.