Bankruptcy is a complex process that can be overwhelming for those who are facing financial difficulties. It's important to have a clear understanding of what filing bankruptcy entails before making a decision. In this article, we'll answer some of the most frequently asked questions about bankruptcy to help you make an informed decision.

1. What is Bankruptcy?

Bankruptcy is a legal process that helps individuals and businesses eliminate or repay their debts under the protection of the bankruptcy court. Filing bankruptcy can provide relief to those who are struggling to pay off their debts and can provide a fresh start financially. However, it is important to understand the process and the consequences before making the decision to file. Here are some frequently asked questions about bankruptcy to help you make an informed decision.

2. What are the Different Types of Bankruptcy?

There are several types of bankruptcy, including Chapter 7, Chapter 13, and Chapter 11. Chapter 7 bankruptcy is the most common and involves the liquidation of assets to pay off debts. Chapter 13 bankruptcy involves the creation of a repayment plan, and Chapter 11 bankruptcy is typically used by businesses to reorganize their debts. 

3. How Will Bankruptcy Affect my Credit Score?

Filing bankruptcy can affect your credit score in a negative way. However, it is crucial to understand that it is not a permanent situation. With proper financial management, you can restore your credit score over time.

4. Will I Lose All of my Assets if I File for Bankruptcy?

Not necessarily. In Chapter 7 bankruptcy, some assets may be sold to pay off debts, but there are exemptions that protect certain assets. In Chapter 13 bankruptcy, you can keep your assets while repaying your debts through a repayment plan.

5. How Long Does Bankruptcy Stay on my Credit Report?

Bankruptcy can stay on your credit report for up to 10 years, but its impact lessens over time.

6. Can I File for Bankruptcy More Than Once?

Yes, but there are restrictions on how often you can file and which type of bankruptcy you can file for.

If you are considering filing for bankruptcy and need guidance, you can rely on the experienced attorneys at Zebley Mehalov & White PC. With offices located in Fayette, Washington, Greene, and Westmoreland counties in southwestern Pennsylvania, their team can help you navigate the process. You can schedule a consultation by calling (724) 399-9200 or visiting their website for more information.