Many Illinois and Indiana residents face financial challenges at some point in their lives. While some are able to overcome the difficulties associated with the loss of a job, the onset of an unexpected medical condition or soaring interest rates on lines of credit, others find themselves completely overwhelmed. In the latter circumstances, it is wise to consider all debt relief options, as it is unrealistic to try to climb out of a hole that just keeps getting deeper.
One option is to file for Chapter 7 bankruptcy. This form of personal bankruptcy is often referred to as liquidation because an individual is required to sell his or her assets, with some exceptions, to pay off creditors. Once this process is completed, any remaining debt may be forgiven. This bankruptcy option can be a great way to escape overwhelming debt and secure a fresh financial start.
However, Chapter 7 bankruptcy is not available to everyone. Instead, individuals must meet certain federal requirements. For example, an individual cannot seek Chapter 7 bankruptcy if he or she has had a previous bankruptcy case dismissed within the last 180 days due to a failure to appear in court or if the case was dismissed after creditors obtained relief to recover property on which liens were held. Also, an individual must go through credit counseling, and he or she must be subjected to a means test to determine if the applicant is abusing the Chapter 7 system.
These federal requirements alone can be tricky to navigate, but they are just the first in a whole serious of problems that those seeking bankruptcy relief can face. This is why it is often imperative that those seeking debt relief speak with an experienced legal professional. They can help advise debtors of their options and the best way in which to pursue them.