What Happens After You Have A Bankruptcy Filed?

Having a bankruptcy filed offers a fresh start to those involved. Depending on the type of bankruptcy you have filed, there are certain rules that you must be willing to follow until your bankruptcy is discharged. You are limited on the acquiring of new tangible assets, purchases on real estate and large items such as cars, and other restrictions on placed on your financial holdings.

What kind of bankruptcy filed should I have? Once again, it depends on your circumstances. Chapter 7 bankruptcies are designed so that certain property can be kept untouched while all remaining property is sold to repay your creditors. Chapter 13 allow for a reconstruction of your debt payments so that creditors will be paid over a three to five-year period. Chapter 11 is for business so that they can remain open while a new formula for their debt is devised. These are the three main forms of bankruptcy that can be filed for individuals.

After you have had your bankruptcy filed, some of the other documents you will need to file include a list of creditors, a basic personal balance sheet, a list of exempt property, and a current income statement for the court to review. Also, after you have had a bankruptcy filed you must give the trustee assigned to your case all property in the estate.

Remember the goal of having a bankruptcy filed is to have as many debts as possible discharged in bankruptcy court. Having a debt discharged means having the liability wipe away so you can get a fresh start. A discharge however will not relieve you for debt if the creditor has a legal lien on your property before the bankruptcy. Liens live on past the bankruptcy discharge and the debtor is still responsible for the amount.