Filing for Personal Bankruptcy: The Basics

The idea of filing for bankruptcy might sound like a dramatic move to take, but it’s actually the best decision you can make if you’re too deep in debt.

It may seem scary at first, but there are some really great benefits that come with it! Here are just three reasons why you should file for bankruptcy.

First, you won’t have to worry about your creditors anymore. Secondly, it will help you get back on track financially. And finally, your credit score will be restored after 7 years – or even sooner.

Now that we’ve seen how filing for personal bankruptcy can be a lifesaver, let’s talk more about what this process entails and how long it’ll take. Let’s start by discussing what types of debts qualify as “unsecured.”

Unsecured debts are those that aren’t backed by collateral, unlike mortgages or car payments. The most common types of unsecured debt are credit card bills, medical debts, loans from family or friends, payday loans, and utility bills. If you have any of these types of debts to repay, filing for bankruptcy is a great option.

About Bankruptcy

Filing for bankruptcy is an effective way to manage your debts so you can get rid of the stress and regain control over your money, but it’s not an easy process and should be done carefully.

There are typically two types of personal bankruptcy you can file: Chapter 7 and Chapter 13.

Each one has its own requirements and specific steps you’ll need to take. In a nutshell, here’s how they differ.

Chapter 7

filing for personal bankruptcyChapter 7 is the more common type of bankruptcy, and it usually takes four to six months to complete. This type of bankruptcy can be filed by anyone who earns less than the median income for their state, has little to no property to sell, and whose debts are primarily unsecured.

It’s important that you check the list of qualifying debts on the U.S. Courts website before filing for Chapter 7.

If your debts don’t qualify on this list, they’ll need to be gone over with a lawyer before you file your petition with the courts. Once you do this, you’ll have to fill out some additional paperwork – including a means test to show your income and expenses – so you can file for bankruptcy.

Once you do, the court will hold a hearing where both parties will prove whether or not something called the “means test” has been satisfied. This requires that someone who isn’t bankrupt must be able to pay off all or some of their unsecured debts.

If all criteria have been met, the bankruptcy court will typically give you a discharge.

It is crucial to obtain the help of a qualified and experienced bankruptcy attorney. They will guide you through the process and help ensure you receive a discharge.

Chapter 13

If you have more than $250,000 in unsecured debts or your income is above your state’s median income, filing for Chapter 7 isn’t an option for you. Instead, Chapter 13 might be what you need to do – but it’s quite a bit more difficult than Chapter 7.

Like Chapter 7, it is highly suggested to obtain the help of an experienced bankruptcy attorney.

With Chapter 13 bankruptcy, you won’t be able to get rid of all your debt – only the portion that exceeds your state’s median income. What happens is, instead of paying off debts with your disposable income each month, you’ll make payments directly to the Chapter 13 trustee who will later distribute them between your creditors.

The court will set up a repayment plan that covers 3 to 5 years, during which you’ll have reduced expenses and increased income. By the end of this time period, it’s possible your debt can be eradicated completely. You’ll need to file paperwork with the courts every few months in order to extend the plan.

After you’ve completed the repayment period, the court will discharge your remaining debts.

Benefits of Bankruptcy

Filing for bankruptcy will help give you peace of mind that your debts are gone or reduced so you can get back on track with managing your finances again.

It’s wise to contact a competent attorney who specializes in personal bankruptcies before filing because they know how the legal system works and will be able to guide you through the process smoothly while making sure all criteria have been met.

Why You Need a Bankruptcy Attorney

Bankruptcy attorneys can help you navigate the complicated legal system and file for bankruptcy. They will be able to guide you through the process, look out for your best interests, and ensure that you receive a discharge from bankruptcy.

It is crucial to contact a competent attorney if filing for personal bankruptcy. They can help make this process as smooth as possible and ensure you get the relief that you need.

It’s important to file for bankruptcy if you have too much debt and no way of paying it off. Personal bankruptcy offers relief from creditors, but the process is long and difficult.

We know that filing for bankruptcy can be a stressful and overwhelming process for clients. The bankruptcy attorneys at Blue Bee work hard to make the process as stress-free as possible for our clients. Call us at (801)285-0980 or visit our website at for more information.

Learn More

At Blue Bee Bankruptcy, our lawyers are highly experienced in the various filing options. More importantly, we understand that each case we receive is unique and each client has different needs and goals. We will discuss these signs with you and decide the best route to take.

We strive to help our clients rebuild their lives and take steps toward a better financial future through filing. 


Best Bankruptcy Attorneys in Salt Lake City

If you’re dealing with the potential of bankruptcy, give us a call. Our team will work to help you by reviewing all of the options our firm has available. We will ensure you’ll get the best possible outcome for your situation.

Get in touch today so we can start working on either halting bankruptcies or preventing them from taking place altogether!

Contact Us Today For Help! You can schedule your free consultation online or call us at (801) 285-098.


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