Bankruptcies in the United States are technically down compared to last year, but experts say this news comes with a caveat. The recent decline of 1.8 percent is the smallest in years, showing that things have somewhat plateaued since the recovery period following the Great Recession. With 790,830 bankruptcy filings last year, Texas individuals considering Chapter 13 or Chapter 7 bankruptcy are far from alone. Here are a few things people should know before taking this step.
The first thing that consumers should do when choosing to file for bankruptcy is to make a list of all debts. Neglecting to list a debt in a bankruptcy filing may prevent someone from getting the fresh start they are hoping for. Another big mistake people make is waiting too long to file for bankruptcy, which could put them in a position where their food or housing situation becomes vulnerable.
While filing too late is a common mistake, some people make the opposite error. It is important to understand the long-term implications of bankruptcy to make an informed decision. Taking some time to review how this may effect a credit score and other life plans may help prevent surprises further down the line.
Finally, failing to file all necessary documents can delay or disrupt the process a great deal. Professional support from a Texas lawyer is very important in filing for bankruptcy as there are many complexities involved in the process. For example, for Chapter 13 or Chapter 7 bankruptcy a person must establish that they meet federal criteria to file. As part of this, they will have to undergo credit counselling and debtor education. Having a legal professional manage the paperwork while attending these classes and doing the in-person work required is a good idea.