Even the closest of friends may find it difficult to discuss indebtedness and financial health, no matter how close a friendship is. The social stigma associated with financial insecurity makes it difficult for those struggling with debt to seek personal advice, which usually precedes approaching professionals for guidance in tackling debt. As residents of Outagamie County, Wisconsin, may know, taking a big step toward debt-free living, such as filing for bankruptcy, requires credit counseling prior to filing a bankruptcy petition.
One such petition, described in Chapter 7 of the bankruptcy code, allows an individual to make a fresh financial start, but involves disposing of available assets towards repaying as much of the existing debt as possible. While most unpaid debt may be discharged by the bankruptcy court, some debts may not be eligible for discharge. Also, those filing for a Chapter 7 bankruptcy must first verify if they qualify through the means test. Those who do not qualify may opt to modify their petition to file for another type of bankruptcy.
It is commonly feared that bankruptcy will leave the filer completely impoverished. However, most individuals who file get to keep assets which are considered exempt. Further, wage-earning debtors can continue earning without garnishment or harassment. Since a Chapter 7 bankruptcy petition is generally addressed within six months of petition, it is possible for debtors to commence re-establishing themselves financially quickly and thereby handle debts that are not discharged.
Given these intricacies, it is essential that the debtor understand what bankruptcy entails and how it impacts various aspects of a person’s life. Understanding is not difficult to obtain if you access our blog, which has several interesting articles that shed light on bankruptcy and its consequences. Bankruptcy is undoubtedly a serious matter and it is best to be as prepared as possible and even consult an attorney prior to filing a petition, although this is not strictly required.