Declaring bankruptcy is a difficult decision that should only happen after you have gained a firm grip on whether or not your situation would benefit from a bankruptcy filing, and you have considered all of your other alternatives to bankruptcy. Learning how to declare bankruptcy is essential if you want to eventually get the outcomes that you originally hoped for, and you will only learn how to file bankruptcy if you can first take into consideration what should happen as a result of your bankruptcy filing. The question, “what happens if I declare bankruptcy”, is a common one, and if you have been asking yourself this recently then you must be aware of a few major points that will help give you an idea of what could happen if you file for bankruptcy.

Because you are probably looking to file for personal bankruptcy, you are going to be limited to filing for either chapter 7, or chapter 13 bankruptcy. What chapter of bankruptcy you file for is going to have a significant effect on what happens after you declare bankruptcy, and only after you have a firm understanding of what chapter you are going to file for can you have a clear idea of what is going to happen once you actually declare bankruptcy. This most often has to do with your level of income, and your ability and willingness to pay back any amount of your currents debts. Chapter 7 typically provides a complete discharge of your debts, while chapter 13 requires that you pay back some of your debts via a three, to five-year repayment plan. It is beyond the scope of this article to go into detail about what kind of bankruptcy you should file for, and you should perform further research with the help of a qualified bankruptcy attorney to determine which type of bankruptcy you should ultimately file for.

That being said, you can still get a general idea of what is going to happen once you file for bankruptcy whether you file for chapter 7, or chapter 13. The major end goal of a personal bankruptcy is to provide you with relief from your current level of debt, by way of either a discharge, which is essentially a complete elimination of your liability for the repayment of such debt, or via a restructuring of the current repayment terms that you may have for a particular debt. When you declare bankruptcy you essentially begin this process, and almost immediately after you file for bankruptcy your creditors will have to stop following through on any sort of collection processes. Relief from collection processes should happen fairly quickly once you have officially declared bankruptcy, but any kind of discharge, or reorganization of payment plans will only happen after your case has gone through the appropriate court processes that will make your bankruptcy complete, and official.

This means that once you have actually filed for bankruptcy with the court that presides over where you live you must then expect that it will take anywhere from four, to six months for your case to be put through the courts, and for you to eventually receive an actual concluding decision. Once your case comes to a close after this time period you should then have an understanding of what debts are going to be given a complete discharge, and which ones you may still be liable for. If you filed for chapter 13 then you are going to have to abide by a repayment plan that is set during your meetings and hearings with the court, and your debts will most likely not be discharged until you have fully satisfied the requirements that were included in your particular repayment plan.

With a chapter 7 filing you can expect to have your assets, and other property to be sold off, or given to creditors, with only your exempt property to be given a pass. What property is considered to be exempt is determined most of the time at the state level, and it is vital that you consult with your particular state’s regulations in regard to property exemptions before you take stock in your ability to keep such property. If you filed for chapter 13, then you should be able to keep most of your assets, and other property as long as you adhere to the repayment plan that you agreed to. The final decision of the court will determine your ultimate fate, and with a chapter 7 filing it will result in an either a discharge, or a continuance of liability for your debts. With a chapter 13 filing you are only going to receive a discharge after you have completed the repayment plan that was decided upon by you, your creditors, and the court. You can get a better idea of what happens after you declare bankruptcy by consulting with a qualified bankruptcy attorney, as only then will you know exactly how your bankruptcy case should play out.