Understanding Basics of Bankruptcy, Types of Property and Debts

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Understanding Basics of Bankruptcy, Types of Property and Debts

Filing for bankruptcy is no rocket science, but it still isn’t an easy thing to do. It helps to have an experienced lawyer by your side. Make sure you hire a lawyer specializing in bankruptcy law.

Chapters and lawyer fee

Many people repel from hiring a lawyer due to their fee. However, lawyers know your financial situation (otherwise you wouldn’t be filing for bankruptcy, right?). When you compare the benefits of hiring a lawyer with the fee of the lawyer, the former wins.

Besides, you can easily find an affordable bankruptcy attorney in Maryland. At times, not hiring a lawyer to save money proves to be costlier.

In fact, as one of the legal experts put it, this isn’t the time to think about saving money. You must focus on smart debt management, which is possible through filing for bankruptcy. It lets you pay off debts quicker and easier. It can also erase a lot of your debts.

Role of the lawyer

  • The lawyer helps you file the petition correctly.
  • He/she will evaluate your financial situation and guide you in the choice of chapters.
  • They will guide you in enrolling for the two courses that you must take and produce their certificates in the court to successfully discharge your case.
  • The lawyer will attend the 341 meeting on your behalf.
  • He/she will negotiate with the creditors and keep a tab on court proceedings.
  • The lawyer will see that your case moves properly in court and is discharged successfully.

In case you do not want to hire a lawyer, then you must be confident of doing all of the above expertly. If not, it’s best to hire one of the Maryland bankruptcy lawyers.

Court-appointed trustee

When you file a petition in the court for bankruptcy, the court appoints you a trustee. The person will be responsible in examining your finances, seeing that you do not perform anything that attracts penalty, and reviewing your assets.

He or she will sort out your property as exempt and non-exempt. If you have non-exempt property, you can sell it to pay your creditors.

Non-exempt property

Non-exempt property includes luxury car, jewelry, rental property, bonds, stocks, vacation home, and artwork. These aren’t the basic necessities of life. Selling them can help you come out of debt.

Exempt property

Exempt property includes a vehicle upto a certain value, a portion of equity in your home, any property like your shop or office that is your primary source of income, household appliances, furnishings, and other goods that are essential, jewelry upto a certain value.

Types of debts

Debts are dischargeable and non-dischargeable.

Dischargeable debts are medical debts, credit card debts, retail store card debt, and personal loans.

Non-dischargeable debts are recent tax debts, student loans, alimony, and child support.

You must know what type of debts you are in. Say, if you have a due student loan or alimony, then it is useless filing for bankruptcy. You will still need to pay these debts.

If you have a mounting credit card bill or personal loan, then filing for bankruptcy can help you. It will wipe off these debts.

An affordable bankruptcy attorney in Maryland can help you know whether filing for bankruptcy is the right choice for you.