Filing for bankruptcy can wreak havoc on your mind, will and emotions. Bankruptcy is stressful for all involved. It can also lead to a stressful financial future if you fail to educate yourself on what happens from day one when you file bankruptcy. What are the key points to educate yourself on when a person declares bankruptcy?

First Step To Filing Bankruptcy
Did you know that filing a personal bankruptcy means you’re filing in Bankruptcy Court? The idea of heading to bankruptcy court can feel daunting, but finding an experienced attorney is the first step in filing a personal bankruptcy. Finding a good attorney that is experienced with personal bankruptcy is critical for knowing your rights and the next steps you must take to complete your petition.
All personal debts and property must be listed when filing. This will ensure that your petition will be smooth and move quickly. Keep in mind that you should write any questions down that you might have regarding the process of your filing and how to proceed.
Counseling and Filing the Right Bankruptcy
Did you know that financial counseling is now required in many states for those who file bankruptcy? This counseling session is important and it is specific to filing bankruptcy. The purpose is to help individuals identify key challenges in their financial world that may need to be corrected for long-term financial success.
The bankruptcy counseling is generally free and provided by a non-profit organization. It’s certainly wise to obtain wise financial counsel whether or not it’s mandatory in your state or county. The attorney will usually provide a list of options for you that offer face-to-face meetings as well as online learning.

Steps 4 and 5
Once you attend your bankruptcy counseling you’ll be encouraged to complete your forms and submit them to the bankruptcy court. These forms include the listing of all of your personal debts and personal property that will be included in your filing. This is because a personal bankruptcy or Chapter 7 bankruptcy leads to a complete liquidation of your debts.
This means that you’ll start over with a clean slate once the hearing is final. This step is also important because it will share with the court whether or not you have assets of value that can be obtained by the court to fill in the gap of what you owe. Those who have no assets of significant value will be referred to as a “no asset” case.
The fifth step is to make sure that you make your attorney aware of anything you would like to keep. This is referred to as a “reaffirmation”. The only debts that an individual will usually keep include a car loan or mortgage for their home. A loan company may offer you the opportunity to refinance your vehicle for lower payments or lower interest. Paying less interest is always favorable with any loan that you hold long-term. This is because interest is the money the bank is earning rather than principal balance getting paid down.
The Final Step
Once you go to court and the filing is finalized, you’ll only need to wait for your discharge papers. This means that everything has been accounted for with the court system. This means that your debts have been cancelled and all creditors have been notified. The process of contacting your creditors takes time, but everything is completed by your attorney’s office on your behalf.
The attorney’s office will provide your creditors with all of the information they have requested. There are a few occasions when a creditor may show up to contest a debt and try to get a consumer to “stay on board” and keep paying on the debt. Once you have been released of the debts you listed, you should no longer hear from your creditors.
A discharge can bring welcome relief when the papers arrive in the mail. It is important that you take into consideration all that you have learned during this time. Don’t underestimate the wise counsel you receive during this time, and use it as a guideline for your future.