Feeling buried under a mountain of debt? The thought of bankruptcy might be scary, but understanding *what happens when you file for bankruptcy* can empower you to make informed decisions.
Essentially, bankruptcy is a legal process that offers debt relief to individuals and businesses. It can involve liquidating assets to pay off creditors (Chapter 7) or creating a repayment plan (Chapter 13).
The process typically involves filing paperwork, attending meetings with creditors, and adhering to court orders. An automatic stay goes into effect, immediately halting most collection actions, lawsuits, and wage garnishments. This offers immediate relief.
While bankruptcy can negatively impact your credit score, it also offers a fresh start. You'll gain freedom from overwhelming debt, allowing you to rebuild your financial future. It's crucial to consult with a qualified attorney or financial advisor to determine if bankruptcy is the right option for you and understand the long-term consequences. Don't let fear paralyze you – explore your options and take control of your finances.
