Business Blog

Bankruptcy should not be taken lightly and the services of a bankruptcy lawyer will be a positive move forward; specialist attorneys in this field can make the process much less painful than it already is! The most recent changes in the law have meant there is more paperwork to complete when filing for bankruptcy, so the services of an attorney can be useful in understanding and preparing your petition. Fortunately these extra initial steps for the debtor do not change what happens once the bankruptcy petition as been filed so it should proceed exactly as it would have before.

Fortunately, the United States bankruptcy protection code provides certain exemptions for people who are filing for bankruptcy when it comes to the disposal of property. It is unlikely that your home or vehicle will be at risk. Work clothes, tools and other essential items like furniture are also exempt, as a bankrupt still needs a place to live and a way to travel to work.

Other restrictions or amendments may also be enforced at state level and this is where a local bankruptcy lawyer will be of most use. The chances are that the person filing for bankruptcy does not own very high value items. The purpose of insolvency is not meant to be a punishment therefore many things required for living are exempt from creditors.

Of course once you are declared bankrupt the information will be added to your personal credit file for ten years although this is not as bad as it seems at first. The truth is that your credit score is more greatly influenced by recent credit activities rather than on transactions that have occurred in the past. This is the reason why not long after you have been made bankrupt, a whole host of companies offering credit will start contacting you, but you must be very careful at this time.

These types of credit agreements usually have hidden and extortionate charges that will usually make the financial situation worse for the person that is bankrupt. A good bankruptcy lawyer should make his client aware of this. The answer is to only deal with reputable companies and only take on the credit you know you can comfortably live; always ensure that you pay more than the minimum payment required.

For careful individuals, this credit rebuild can be as little as two to four years providing everything is kept up to date. Sure, the bankruptcy will still appear on your credit report, but if your current credit is solid, that’s not likely to keep you from buying a home or a car or even obtaining some unsecured credit accounts.

There is now and probably always will be a stigma to bankruptcy. The credit industry quietly fuels this notion as it makes people reluctant to pursue bankruptcy. Bankruptcy is generally seen as a last resort, but as legislation continues to add changes, it will become harder for individuals to apply for bankruptcy. Don’t be fooled though, because your bankruptcy lawyer will tell you that most people that file for bankruptcy protection have just been unlucky and never had any intention of this happening.

Simon Slade is an auction expert in New Zealand. Simon is developing a new startup in the online auction space.