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What To Know Before Filing For Bankruptcy

Posted by in Bankruptcy
15
Jun 2020

Filing for bankruptcy can be a difficult decision, with potentially drastic consequences that will impact many facets of your life. Understanding both your situation and the bankruptcy process in Ontario is the first step in ensuring you are making a decision that will benefit you in the long term.

What should i know before filing for bankruptcy?

When considering bankruptcy, you will likely be facing many debts that appear to be insurmountable. While mishandling any issues can lead to many different problems, undertaking the proper process of filing for bankruptcy offers benefits that will help ensure your long-term future. In such a stressful time, the only way to make sure you do not make any potentially damaging mistakes is to gather all the necessary information prior to making any decision.

Know What Debts are Erased by Bankruptcy

Before the bankruptcy process, you must first understand which debt will or will not be erased by bankruptcy. Any time bankruptcy is being considered; there will always be many factors in play. It’s essential to make sure you do not lump everything together, preventing you from understanding the important details. By distinguishing which debts cannot be included, you will be prepared for any potential outcome in your situation.

With bankruptcy in Ontario, you are still required to pay alimony or support, court fines, debt incurred by fraud, and any remaining student loans. Exactly what bankruptcy entails will vary from one party to another, meaning that debt erasure may not be universal. Before knowing the best decision to make, you must know your situation once it’s resolved. Ideally, you will know exactly what has to be paid and when, and what debts will be wiped out after bankruptcy is filed.

Know What Will Happen to Your Credit

Immediately upon filing for bankruptcy, there will be repercussions on your credit score. It is important to understand that your credit score will be damaged. Understanding how your credit score will be impacted is one of the most important parts of recovering from bankruptcy. Not only does bankruptcy ruin any credit that you may have built up, but it can also leave a mark on your score for a number of years.

Knowing how to deal with your resulting credit score will give you a great advantage in overcoming bankruptcy. Even if having your credit score damaged because of bankruptcy is inevitable, it will remain one of the most important parts in the process of recovering from potentially crippling debt. Having a damaged credit score will not necessarily make it impossible for you to get credit at a later point. That being said, it is an opportunity for creditors to increase their interest rates and try to take advantage of your situation.

Your Creditors Must be Informed.

The moment you decide to file for bankruptcy, you are giving your finances up for public scrutiny. Any creditors, including family members and business associates, will be involved in the process and will understand your situation. Complete honesty is crucial to maintain the integrity of the process; that means you may have to deal with uncomfortable financial information being provided to your creditors.

The reality is that these people need to know about your finances because they will be directly impacted by the process. It is important that creditors, or any individual who is owed a debt, know what is going on with their money. The bankruptcy process can add different kinds of strain on an individual’s life, but attempting to hide any information from public scrutiny will only worsen the process and threaten the potential results.

Know What Kind of Paperwork to Expect

Filing for bankruptcy is a complicated process, and the only way to simplify it is with organized paperwork and proper documentation. Full disclosure is essential to any bankruptcy case, and the only way to establish reliability is with proper documentation. With an adequate e-paper trail, everyone will have access to all the necessary information. Unfortunately, navigating that trail can be a tremendous task and will often set people back.

First and foremost, it is important to make sure that your paperwork is in order. Before knowing what will need to be done when the process begins, make sure you understand every detail of your situation. By having your situation documented, it will be much easier once you begin the bankruptcy process.

Get the Help Available to You

Things will often be overwhelming when dealing with bankruptcy, and many obstacles seem insurmountable. While the process will inevitably be difficult, it is important to have a proper understanding of what to expect before the process begins. Fortunately, there are experts available to you at a moment’s notice, making sure you are never left alone to handle such a complicated endeavour.

The best way to ensure you are making the right decision is to seek out an expert opinion. With so many different factors involved in a bankruptcy, it will be much more costly to try and handle things on your own. Before taking any action, make sure you call Kevin Thatcher & Associates at 1-866-702-9801 for a free consultation that will give you the information needed. You can also access any additional information at www.billfixer.com and even book your free consultation online.

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