If you are exploring your options concerning bankruptcy, you should arm yourself with as much knowledge as possible in order to maximize your chances of a successful filing. Bankruptcy law is complex as well as variable. Not only do laws differ depending on what state you file in, new bankruptcy laws are enacted on a regular basis. Understanding some of the common terms used in bankruptcy filing procedures will help demystify the process for you and enable you to work more closely with a qualified attorney in order to pursue the best course of action. Following are four basic bankruptcy terms to get you started in your quest for a healthy financial future.
Discharge
Discharge refers to the release of a debtor from specific financial obligations. This prevents creditors from taking legal action against the debtor, including turning the case over to a collections agency. Creditors are also prohibited by law from contacting you in any way after a discharge has taken place, including calling your home or office, emailing you, or sending correspondence through the postal system.
Joint Petition
A joint petition is where two people file a joint bankruptcy claim. It is common for those in domestic partnerships to file joint petitions. However, a qualified bankruptcy attorney should be consulted before a joint petition is filed. If one partner accrued substantial debt before the partnership became official or otherwise holds the majority of the debt, it may be advisable for the other spouse to decline to be a co-petitioner. This can prevent that spouse from incurring blemishes to his or her credit report.
Nondischargeable Debt
Many consumers erroneously believe that any and all debt is automatically wiped out as a result of filing a petition for bankruptcy, but this is not the case. Certain types of debt are known as nondischargeable, and creditors who hold these types of debts will be allowed to continue collection efforts even after bankruptcy filings are complete. Examples of nondischargeable debt include
Be sure to ask your attorney for a thorough explanation of any nondischargable debt that may be applicable in your case.
Prebankruptcy Planning
This is one of the most important aspects of filing a successful bankruptcy petition and one of the major reasons why you should enlist the assistance of a knowledgeable, experienced attorney who specialized in bankruptcy law. Prebankruptcy planning can involve relatively complex legal maneuvers designed to maximize ability of the petitioner to take advantage of exemptions. For instance, if you own property that may be considered by the courts to be nonexempt, a good attorney can advise you in ways to convert the property into an exempt asset such as transferring ownership to a trusted family member.
There are dozens of other terms specific to the bankruptcy process that you may or may not need to familiarize yourself with. All situations are different, and some terms that may be important in the petitions of others may not be applicable at all to your specific situation. Asking your bankruptcy lawyer for a list of terms that pertain to your situation will provide you with a great start to understanding the process.
Share26 December 2014
My name is Noni. When I was in college, I was hit by a car while crossing the street. My life was never in danger, but I did break a few bones and had a lot of huge medical bills. I was hoping I wouldn't have to get involved with an attorney, but unfortunately, it came down to that. I used a family friend who is an accident attorney to get some compensation. A few years later, I was hit while riding my bike and had to go through the same process. I suppose I'm lucky to be alive. And it's thanks to accident attorneys that I have been able to put my life back together. I started this blog as a way to let others know just how much lawyers can help you in certain situations.