Top 5 Questions To Ask Your Bankruptcy Attorney Before Filing

Posted on

Are you contemplating filing for bankruptcy? The prospect of bankruptcy is stressful, and understandably so — it can be confusing and expensive to go through this process. But it becomes easier if you go into it fully informed about the process and how it affects different aspects of your life. Before you officially file, ask your bankruptcy attorney these five questions to help you make the right decisions.

1. Are You Eligible for Bankruptcy?

You must show you cannot meet your financial obligations to file for bankruptcy. Otherwise, the process would be abused. Therefore, it's important to know whether or not you qualify before starting the process. Your lawyer is the best guide on eligibility.

If you have a lot of debt but aren't sure if it qualifies as dischargeable debt (the kind that can be eliminated in bankruptcy), ask your attorney about Chapter 7 and Chapter 13 bankruptcy eligibility requirements. They will help determine whether or not filing is even an option for you.

2. Is It Possible To Save Your Home?

For many people, the biggest threat of being under financial duress is losing their homes. It is essential to ask your attorney if it's possible to save your home before filing for bankruptcy. They will inform you how bankruptcy affects your home ownership, depending on the number and types of homes you own and the ownership details (whether you own it fully or co-own it).

3. Which Debts Will Be Canceled and Which Won't?

Certain debts will be discharged (canceled), and others will remain when you file for bankruptcy. It's a good idea to find out which of your debts will be canceled so you can keep paying the remaining debts. 

Your bankruptcy lawyer will outline how bankruptcy affects your debt obligations. For example, if a creditor or debt collector contacts you after filing, you will be shielded from harassment. 

4. How Will Bankruptcy Affect Your Life?

Being declared bankrupt provides some financial relief, but it comes with various consequences, including your personal life. It is good to know what will happen before you file for bankruptcy to prepare yourself and your family for these changes. 

It is especially important to know if your retirement is in jeopardy. Your lawyer can inform you if it impacts your 401(k) accounts and other retirement savings. 

5. Are There Alternatives to Bankruptcy?

Is filing for bankruptcy your best way out of financial distress? Your lawyer can help assess whether there are other ways out. For example, if you have significant assets, you might consider selling them off and paying down debts. 

Filing for bankruptcy provides much-needed relief from financial difficulties, but you need to go into it with good information. Call a bankruptcy attorney to book an appointment to explore any questions troubling you.

Contact a law firm like Martinez Law Firm to learn more.