Reaching the point when you decide you need to file for bankruptcy is no easy process. Typically it involves a thorough evaluation of your condition and coming to terms with your financial realities. Once the decision is made, the next step is to prepare yourself for the bankruptcy process. This process is not simple and can be overwhelming. Fortunately, by taking specific actions to prepare before your bankruptcy begins, you can help make the process more efficient and effective.
Know Your Debts and Assets
When initially preparing to file it is important to conduct a detailed inventory of all of your debt and assets. Bankruptcy law takes into consideration what you have and what you owe. In some cases, there may be debt which does not qualify for bankruptcy. Michigan, like most other states, have specific laws regarding what assets may be included in or excluded from bankruptcy. Therefore, being aware of everything that will possibly be discharged or excluded from the bankruptcy is a critical piece of your preparatory process.
Gather Legal Documents
Gather all correspondence from your creditors. Often those facing bankruptcies have legal actions against them for unpaid debt. For example, if you failed to pay your credit card balance you may be facing a lawsuit from the credit card company to recover the debt. By collecting all legal documents pertaining to creditor actions against you, you will later be in a position to communicate with your creditors regarding your debts and ensure they are correctly included in the bankruptcy.
Some other key items that you will need to have ready are your tax returns. Having at least two year’s prior tax returns will be helpful to your filing. If you have not filed taxes, you will need to be prepared to explain why you have not. If you have not paid some of your taxes, this will be an important area to address and consider before filing for bankruptcy. It is also important to note that under most circumstances, unpaid tax debt will not be eligible for bankruptcy discharge.
Bankruptcy allows for certain exemptions. What this means is that you may ask that certain assets not be considered part of the bankruptcy and remain in your possession. For instance, in Michigan some examples of possible exemptions include your home, qualifying personal property up to a certain value, pensions, and some public benefits. Determining the assets for which you may seek bankruptcy exemptions will help you prepare for the future.
In order to fully prepare for bankruptcy, it is critical that you consult with an experienced bankruptcy attorney who can help you ready yourself for this complicated process. We the have experience and knowledge you need to prepare for and successfully navigate this process. Please contact us online or by phone if we may be of assistance. http://bestmichiganlawyer.com/contact-us