Filing Bankruptcy Lawyer Memphis, TN

Filing-Bankruptcy-Lawyer-Memphis-TN-stack-of-credit-cards.jpegIf you’re thinking about declaring bankruptcy, you may want to speak with a filing bankruptcy lawyer  Memphis, TN residents rely on. Bankruptcy can help you wipe out most of your unsecured debts and get a fresh start. However, before you make the decision to file bankruptcy, it’s important to educate yourself about the process. Here are a few important things to know about bankruptcy.

Bankruptcy Doesn’t Eliminate All Debts

One of the biggest misconceptions about bankruptcy is that it will get rid of all your debts. The truth is that certain debts, like student loans, child support and taxes, aren’t dischargeable in bankruptcy. If you have these sorts of debts, you will still have to find a way to pay them back.

There Are Two Types of Bankruptcy

For individuals, there are two types of bankruptcy to choose from: Chapter 7 or Chapter 13. Chapter 7 bankruptcy is designed with lower-income individuals who may not have the money to repay their unsecured debts, like credit card debt and medical bills. Chapter 7 bankruptcy wipes out these debts completely.

Chapter 13, on the other hand, is for individuals who earn a consistent income and have enough money to pay back their debts through a repayment plan. This type of bankruptcy takes longer to complete, but allows you to keep all of your property.

Bankruptcy Can Take a Long Time to Complete

While it would be nice if bankruptcy was a quick fix to your debt problems, it doesn’t work that way. As a filing for bankruptcy lawyer in Memphis, TN can explain, bankruptcy often takes longer than most people think. For example, if you’re declaring Chapter 7 bankruptcy, you can expect the process to take between four and six months. If you decide to file Chapter 13 bankruptcy, it will take three to five years to complete.

You Can’t Rack Up New Debt Before Declaring Bankruptcy

Some people make the mistake of going on a spending spree before declaring bankruptcy. Don’t do this. Any debts you acquire within 90 days of filing for bankruptcy can’t be discharged. Therefore, you will still be responsible for paying back these new debts.

Bankruptcy Will Lower Your Credit Score

If you plan to file for bankruptcy, understand that your credit rating will take a hit initially. It may be more difficult for you to qualify for loans. However, you can rebuild your credit over time.

If you’re interested in declaring bankruptcy, schedule a consultation with a filing bankruptcy lawyer in Memphis, TN at Darrell Castle & Associates today.