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5 Legal Considerations To Make Before Filing For Bankruptcy

Deciding whether or not to file for bankruptcy can bring its share of headaches. You may not be entirely sure that this is the right move to make. As it turns out, you may be right. You may have other options to explore first. But if it turns out you have no other choice, here are 5 legal matters to keep in mind.

1. Make Sure You Hire a Reliable Lawyer

One of the first things you need to make sure of is to hire a professional and reliable NJ bankruptcy lawyer. An experienced bankruptcy attorney may be able to suggest other ways that you can make use of in order to avoid having to file. They can mediate between you and your creditors to help you come to a payment plan that satisfies all parties.

If there is no other option to explore, your lawyer can stand by you through every stage of the bankruptcy process. They can help you from making mistakes such as accounting errors or forgetting to declare certain assets. They can also make sure that your creditors don’t try to take more from you than you owe them.


2. Can You Make Money By Selling Assets?

One of the top questions you should be asking yourself before you file for any type of bankruptcy is whether you can avoid it. One of the chief ways to do so may be to get rid of some of your assets. In a case like this, there may be some legal questions involved. You may need a lawyer to help you figure them all out.

For example, are the assets you are thinking of selling truly yours? Do you owe them outright or do others have any kind of claim to them? It may be a question of whether these assets are legal to sell in the manner you have planned. The last factor is whether selling will raise enough money to wipe out your debts.


3. Can Mediation Solve Your Existing Debt Issues?

Another thing to keep in mind is that you may be able to come to a settlement via mediation. You and your lawyer can sit down with your creditors to try to arrive at a solution to the issue. This may result in a payment plan whose conditions are flexible enough to allow you to avoid having to file for bankruptcy.

If this is the case, you may be able to get back on a good financial footing much sooner than if you had gone through the bankruptcy process. However, the results of the mediation need to be legally binding. The settlement you arrive at has to be examined by and agreed to by a court in order to be acceptable.


4. Make Sure Your Debt is Large Enough

A bankruptcy lawyer can be the best kind of financial adviser to lean on during this complex process. One of the main questions that they can help you answer is whether or not your debt is large enough to justify filing for bankruptcy.

It’s true that there is no minimum amount of debt that you have to have in order to file. But it’s also true that an amount that is untenable for one person may be manageable for another. This is why you need the advice of a lawyer. They can help you make a judgment call that may save you a lot of time and money.


5. Make Sure You Don’t Make Too Much Money

The last thing to consider almost sounds disingenuous. You need to be sure that you don’t make too much to qualify for bankruptcy. But if your income is too high, you can’t legally qualify for some forms. Your lawyer can examine your finances to discover if you can legally file.


The Time to Settle Legal Issues is Now

There is no better time than the present to get started on handling all of your various legal issues. Since these will most likely be related to debt, it’s a good time to contact a financial adviser. This advice can take the form of helping you to decide whether or not filing for bankruptcy will be a good move.

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