Bankruptcy is one of the scariest words in the English language. Many people shudder at the simple thought of having to declare bankruptcy and endure the process of coming out the other end. While that’s bad enough, the prospect of going through it without a bankruptcy attorney Howard County MD, should be even more frightening. Let’s look at what bankruptcy really entails, and how a lawyer can help.
Chapter 7 Bankruptcy
First, let’s look at the two most common types of personal bankruptcy (business bankruptcies and reorganizations are a completely different topic.) The most common type for individuals is Chapter 7, in which assets are liquidated to pay debts. This means that you may be required through a bankruptcy attorney Howard County MD to sell your home, vehicles, and other possessions of values to pay back as much of your credit card and loan debt as possible before starting a clean slate. Chapter 7 bankruptcy will stay on credit reports as a negative for ten years, gradually improving as that time goes by.
Chapter 13 Bankruptcy
For many people, Chapter 13 bankruptcy is a more appealing approach, as it is considered a “restructuring” rather than a liquidation. Think of it as an extreme loan consolidation. It will still negatively affect your credit for seven years, but you will probably be able to keep most of your property.
Paperwork and Appearances
As you can imagine, these processes require lots of negotiation, paperwork and court appearances. Bankruptcies always begin in federal court, and while you technically can represent yourself, the fact of the matter is that you have two to three times better chances of successfully being approved with the help of a bankruptcy attorney Howard County MD.
Bankruptcy is an unpleasant but necessary process. While hiring a lawyer may seem like an added expense in the beginning, it will set you up to get your finances back to normal in the long run.