Claimants learn about the details of filing a bankruptcy claim by discussing their finances with an attorney. The attorney determines if the claimant qualifies for their preferred chapter. They will also guide the claimant through the process and explain any issues that could lead to a sudden discharge of the case.
Choosing the Appropriate Chapter
When starting a bankruptcy claim, the claimant must choose the most appropriate chapter that corrects their financial situation. They must qualify according to their income or assets. With chapter 13, they must have an income that is greater than the median for their household. With chapter 7, they must have enough assets to sell to settle their debts. Claimants can learn how to file bankruptcy in Oklahoma by contacting an attorney right now.
The Automatic Stay for the Case
The automatic stay is available throughout the entire bankruptcy case. With chapter 13, it lasts up to five years, and with chapter 7, it lasts up to six months. During the automatic stay, creditors cannot file any legal claims against the claimant to collect any outstanding balance. A lender cannot foreclose on their home or repossess their automobiles. It protects the consumer against all legal actions until the end of the case.
If a debt is not settled during the bankruptcy, the creditors can take legal action after the automatic stay no longer applies. However, if the debt was discharged, they cannot.
Discharging Certain Debts
The judge can discharge certain debts and eliminate them from the consumer's credit history. Unsecured credit card debts and personal loans are the most common debts that are discharged in bankruptcy. If the judge discharges the debts, the claimant will not have to pay for them later. They are listed as settled in full, and the consumer can get the debts removed from their credit report after the end of the bankruptcy claim. If they do not complete the bankruptcy claim, the claimant is responsible for all debts once the case is dismissed.
Following the Terms of the Bankruptcy
All claimants must follow all terms of the bankruptcy. This means they must pay all payments in chapter 13, and they must use all disposable income to pay off debts that were not included in the claim. For chapter 7, they must surrender all deeds and titles to the court and can't interfere in the sale of any of their assets.
Rebuilding Their Credit After Bankruptcy
The person has the opportunity to rebuild their credit after bankruptcy. After the bankruptcy, they can get all debts that were settled off their credit history. The bankruptcy stays on there for up to ten years. However, they could open a new line of credit after they conclude the bankruptcy.
Claimants must determine what chapter of bankruptcy is most appealing for their financial circumstances. Each chapter provides benefits, but the claimant must be eligible for bankruptcy to get an approval. They must also complete the case according to the court's specifications. Any failure to comply will lead to a discharge of the entire case.