7 Steps to Navigate the Bankruptcy Process
Life is all about making sound decisions and hoping that the unforeseen does not impact them too negatively. But what makes life equal parts exciting and scary is that one can never be fully prepared for what life has in store for us. We all make investments.
Investments in our jobs and businesses, homes and other investment avenues. While these investments are supposed to give us the sense of safety in case something goes wrong, sometimes these backup plans are not enough. A bad investment, an accident or even a change in government’s policy can all lead to us losing all our money.
While this sounds scary, and the fact that we cannot really be prepared to handle this situation, there is some good news if you want to call it that. If you ever find yourself under a lot of debt and are finding it hard to make ends meet, you still have some options to climb out of the situation and start your life all over again. Filing for bankruptcy is one such option. It can make sure that the people you owe money to are not after your life, and gives you the chance to make a fresh start. Something to know is how the filing for bankruptcy process work, and below we explain it to you.
1. Setting up the first appointment
After doing due diligence and a lot of research, you will finally zero down on your Licensed Insolvency Trustee (LIT). During the first appointment, you will explain your current financial situation in detail to your Licensed Insolvency Trustee. Then, the Licensed Insolvency Trustee will present you with all the options available to you to get out of your financial troubles. Once you are convinced that filing for bankruptcy is your only option, you, along with your Licensed Insolvency Trustee, will move to the next step.
2. Filling out the bankruptcy application
The filing of your bankruptcy application does not have to take place during your first appointment with your Licensed Insolvency Trustee. This step is where your Licensed Insolvency Trustee will take you through your next steps and what your future may have in store after filing for bankruptcy. This step only takes place once you have decided to move forward with the filing for your bankruptcy.
3. Filing for bankruptcy
Once you have filled out your application form, your Licensed Insolvency Trustee will collect your application along with all the supporting documents required to file for bankruptcy. Once all the papers are ready, your Licensed Insolvency Trustee will initiate the process by filing the documents with the federal government. The submission of your documents also means that your creditors should no longer harass you to get their money back.
4. Informing the creditors
Fortunately for you, it is your Licensed Insolvency Trustee’s job to inform your creditors that you have filed for bankruptcy. If they need more information, they can meet with your Licensed Insolvency Trustee to get more details about your financial situation and to learn more about how they will get their money back.
5. Selling of assets
Once you have filed for bankruptcy, you will have some exemptions when it comes to holding onto your assets. But every asset that is not exempted will be now sold to recover some money to pay off your debts.
6. Paying your Licensed Insolvency Trustee
During this entire process, you will be required to make monthly payments to your Licensed Insolvency Trustee for the services they are offering you.
7. Credit counselling
The last step of the process is for you to attend and complete your credit counselling sessions. These sessions are mandatory, but are also more than useful in teaching you how you can better manage your finances now that you don’t have any debt to repay.
With the above 7 steps, you can hit reset on your financial situation by filing for bankruptcy.