Women In Business

10 Important things you need to know about bankruptcy right now

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Being financially literate is an invaluable skill that is helpful for a lifetime. As a business woman, you can never be too informed. Knowing what takes part in certain ‘what if’ situations is a great way to ensure fail safes.

This is why, while filing for bankruptcy might not be at the forefront of your to-do list, it’s key to be informed of the procedures in place for anyone that has to go through it. It’s becoming more and more commonplace each day as people take on more debt than they can handle and the interest adds up over time.

Without further ado, here are ten important things you should know about bankruptcy.

1. Filing for bankruptcy has long lasting effects

Unfortunately, filing for bankruptcy is not a one and done deal, and if you ever had no other choice but to file, it will affect your credit for years to come. Which in turn affects any significant investments you might want to make in the future, such as buying a house or purchasing a car.

2. Filing for bankruptcy only applies to you in contractual situations

If for example, you got a loan with your significant other to purchase a car, if you choose to file for bankruptcy your partner would still be liable for the debt, and collection agencies can still go after them.

3. It’s best to be meticulous about bankruptcy forms

Bankruptcy forms can often be confusing and require a great deal of attention if you are to fill them out accurately. This way you avoid costly mistakes and confusions in the future. Filling them out with the help of a trusted and experienced lawyer can help simplify the process.

4. Chapter 7 bankruptcy is the most popular dismissal used for unsecured debt

The second most popular is the chapter 13 dismissal, which can be a much lengthier process than the former. This is then followed by the chapter 11 dismissal as the third most popular.

5. When filing for bankruptcy, honesty is the best policy

You don’t want to make the mistake of lying on your statements, or in the court where they’ll scrutinize your financial endeavors and decisions.

6. Some types of debt can’t be discharged

Filing for bankruptcy does not magically fix your entire financial situation. Some types of debt, like student loans, back taxes, or child support cannot be discharged by simply filing for bankruptcy.

7. Your filings become public

This is especially scrutinizing if you prefer not to divulge your finances with friends or family. This means anyone who chooses to do so can look up your financial information.

8. Filing for bankruptcy will require additional spending

This means spending on lawyers’ fees, filings, and procedures in the processing of your filing

9. Your credit cards are not really your own

Court officials will confiscate any credit cards you may have and can dictate what you may or may not spend money on.

10. Filing for bankruptcy isn’t an automatic fix

There are long lasting effects of choosing to file for bankruptcy that can impact the decisions and purchases you’ll be able to make in the future.

Filing for bankruptcy might be your only option when it comes to landing in dire financial debt. Being well informed on the subject beforehand can help in not making rash decisions that might eventually land you in unsurmountable debt in the first place. Learning about bankruptcy is always a good reminder to pay all bills on time, take on the debt that you know you’ll be able to easily pay back, and not overreach your means.

About Lauren Webber

Lauren Webber is a former HR manager and lover of psychology who now runs daintymom.com among her other pursuits. Her interests range from the corporate world to health and self-care to home improvement and parenting. Now if only someone came up with a way to extend the day by about 20 more hours, she could dedicate herself to all of these equally and constantly.

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