How to Prepare For Bankruptcy

Bankruptcy is a procedure that allows businesses to repay all the debts incurred while being protected by the federal bankruptcy court. Business owners who foresee that their business is not anymore working can file for bankruptcy.

However, there are lots of things to take into account when preparing for bankruptcy.

The procedures in filing bankruptcy seem to be overwhelming and daunting not to mention the stressful time. That is why for business owners who are planning to foreclose their business can file bankruptcy provided to meet the necessary requirements and rules set by the court. Thus, it is important to know the basic steps in preparing as well as filing of bankruptcy.

The Basic Steps

The first thing that you should do when planning to file for bankruptcy is to consult a lawyer so that you will know the important things that you should gather. Likewise, the lawyer can also help you in putting everything in proper places. Reviewing your finances is necessary so that you will know your debts payable. To make it easier you can make a list of all your bills and creditors in this way you can have a clear view how much you still owe to your creditors. You should not ignore making a list otherwise you will find hard time in organizing the things needed in preparing for bankruptcy. Obviously, the lawyer is a great help in making the list.

After you have made your list the next step to do is to contact the people you owe. You can attempt talk with them in order to modify the payment plans. In this way, you can have the chance to pay the amount in lower pay off. All you have to do is to explain to them your eagerness to pay off the outstanding debts in the best way you can. Likewise, you should ensure to record all the things discussed with your creditors. Aside from that you need to gather all the documents of indebtedness such as credit card statements, insurance policies, title policies, notice of defaults and other documents. It is also good to file all the correspondence from the creditors and other collection agencies.

Once everything is organized, you can then file the bankruptcy petition. Your lawyer will be the one to handle all the legal aspects and proceedings of the petition. That is why you should ensure that all the documents are intact to ensure quick processing of the petition. On the other hand, preparing and filing of bankruptcy petition does not end there because you need to attend hearing with your creditors. Expect that your creditors will be asking questions about your outstanding debts. This is the most uncomfortable and scary yet your lawyer should always be there to help you. Once the creditors are convinced about your explanation you will then receive a discharge notice.


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