Filing for personal bankruptcy can be a life changing experience. Anyone having to consider filing personal bankruptcy can be terrified of all the paperwork involved and then thinking about how this is going to impact your credit afterwards can just be very overwhelming and frightening for some. Choosing the right Washington DC bankruptcy lawyer is crucial for your piece of mind and sanity as you try to navigate your way back onto the right path to financial stability.
Bankruptcy is a personal decision. Most people file bankruptcy because of crushing debts, often caused by financial hardships such as unemployment, lack of adequate insurance, catastrophic medical expenses, marital problems, overextended credit or, in some cases, out of control spending.
Because of the complexity of filing for personal bankruptcy, you should contact a bankruptcy lawyer in Washington DC who specializes in the field. They can help you with the whole process. A Washington DC bankruptcy lawyer typically charges a flat fee, which may well be worth it if you can eliminate some or all of your debt.
There are two kinds of personal bankruptcy: Chapter 7 and Chapter 13. Chapter 7 personal bankruptcy involves liquidating your assets and turning them over to the courts. A trustee of the courts follows a court-supervised procedure, reduces your assets to cash, and then pays the creditors. A Chapter 13 bankruptcy is filed by a debtor who has a valuable asset, such as a home, that he or she wishes to keep, but is not covered by the state or federal exemptions. Under this kind of bankruptcy, the debtor, through the courts, sets up a plan of payment with the creditors over a period of several years.
Once your Washington DC bankruptcy attorney has filed your personal bankruptcy case and the court has approved the petition, all transactions are frozen. Notices are mailed to creditors who must stop all actions against you to recover or collect money. Once the debt has been satisfactorily resolved under the agreement stated in the personal bankruptcy proceedings, a discharge is issued, releasing the debt. All creditors receive a permanent order to stop all forms of collection action against you on discharged debts, including legal action and all communications.