Filing for bankruptcy is a relatively good alternative debt relieve option to explore once you realize your financial situation is nosediving. Issues like your credit card being always on the limit, receiving legal action threats one after another from your creditors and continuously using credit card advances to sort your bills are all tell-tale signs that you need to kick start the bankruptcy process. Declaring yourself bankrupt gives you the opportunity for a new financial start.
The first step towards filing for bankruptcy is getting in touch with a licensed insolvency trustee. You will discuss your situation with them, and they will be able to advise you on whether filing for bankruptcy will be a good option. A licensed insolvency trustee is there to help you understand the debt regulation requirements stipulated by the government. These trustees also have the right to administer consumer proposals and bankruptcies. Your trustee will help you with the process of filing for bankruptcy and help ensure that your rights are not violated during the process.
Once you find a trustee who will be helping you file for bankruptcy, the next thing is to schedule the first consultation with them. The trustee will require you to bring along particular documents that have details of your financial situation. They will analyse the reports then outline the relevant bankruptcy options that are best suited for you. The trustee will then explain in details every bankruptcy option and advice you on the best alternative. You are the one to make the final decision on the bankruptcy option that you are most comfortable with.
If you and your trustee decide to proceed with filing for bankruptcy, your trustee will give you information forms to fill. These forms include a statement of affairs and assignment of assets. The forms require you to fill your details such as your name and your date of birth, a list of your creditors as well as another list of your assets. Once the trustee gets this information, they will start the initial paperwork and review the bankruptcy process with you once more. If you feel contented, you will sign the papers and your bankruptcy begins.
Unsecured creditors cannot collect debts from you once your bankruptcy is filed. Your trustee will send a copy of the bankruptcy paperwork to creditors within five days from the start of your bankruptcy for them to file claims. If you happen not to have filed your tax returns for the previous period until the date of bankruptcy your trustee will do the filing for you. They will also help you with clearing any other penalties that had been imposed on you. You will then be subject to certain obligations including a monthly income statement and attending credit counselling sessions.