What You Must Know about Filing Bankruptcy

What You Must Know about Filing Bankruptcy

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For some businesses, it is inevitable to file a bankruptcy during these difficult times. To presentar concurso de acreedores, it is important to know what it entails. First off, it’s important to know the types of bankruptcy.

Not all companies have the same characteristics. According to the Bankruptcy Law, there are various types of bankruptcy, and these are based on the following factors: the amount of liability that is owed, the company’s number of creditors, and company’s asset value.

The ordinary bankruptcy is the basis for drafting the Bankruptcy Law. It is applicable to all procedures except for those cases wherein there is a foreseeable specific one. The abbreviated bankruptcy is the shortened version of regular bankruptcy procedure. This streamlines the procedure since the deadlines that have to be met are reduced to half. For a company to have the abbreviated procedure, it is necessary for the company to have 50 million liabilities, 50 creditors, and also 5 million assets.

Depending on who insists the contest, there are two types of contest: the voluntary and the necessary. Voluntary, a bankruptcy is voluntary when the first request is urged by the debtor. Necessary, is when the bankruptcy is declared as necessary if ever its application is urged by one more creditors before the debtor.

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There are also several steps to take when filing a bankruptcy. This starts with compiling all the records you have, such as debts, assets, income, and expenses. You list all of them for you to have a much better understanding of your situation.

Next step is to undergo credit counseling within 80 days before you file the case. You need counseling from an approved provider who you can find in the US Courts website. There are many agencies that offer this on the phone or through the net.

Next step is to file a petition for bankruptcy which means that you need to hire a bankruptcy lawyer. Individuals who are filing for Chapter 7 or Chapter 13 bankruptcy may not be required to hire a lawyer, but it is indeed a serious risk if you opt to represent yourself.

One reason is that you may not be familiar with the federal or state bankruptcy laws and are not aware of what laws are applicable in your particular situation particularly on what debts that are capable and not capable of being discharged. Judges are not allowed to give advice; neither are those court employees that are involved in the same case.

Once the petition is accepted, the case will be assigned to a court trustee who will set you up a meeting with the creditors. You have to attend the meeting, but the creditors are not required. This is the chance for them to ask you or the court trustee questions. If you can’t approve a lawyer, you can avail yourself of free legal services. If you are searching for a lawyer to represent you, you can acquire resources or information from the American Bar Association.

Also most people consider bankruptcy only after pursuing debt consolidation or debt settlement.