Bankruptcy offers a legal route to stop collections and address debts through liquidation (Chapter 7) or a court-approved repayment plan (Chapter 13). An attorney helps select the right option, manage required credit counseling and education, and represent you in court. Filing triggers an automatic stay, can discharge many unsecured debts, and affects credit reports for several years.

Why an attorney matters

Bankruptcy involves federal law, court procedures, and deadlines. An experienced bankruptcy attorney can explain whether you qualify for liquidation (commonly Chapter 7) or a repayment plan (commonly Chapter 13), prepare and file your paperwork, and represent you at hearings. People who try to file pro se can do so, but they risk errors that may delay the case or jeopardize relief.

Bankruptcy as a way to restart

Filing for bankruptcy is often framed as a fresh start rather than an end. The process can stop most collection efforts immediately through the automatic stay and give you breathing room to reorganize finances. Many people emerge from bankruptcy and rebuild credit over several years.

Common paths: liquidation vs. repayment

  • Chapter 7 (liquidation): A trustee may sell nonexempt assets to pay creditors. Many filers keep exempt property and receive a discharge of qualifying unsecured debts.
  • Chapter 13 (repayment plan): Individuals with steady income propose a court-approved repayment plan, typically lasting three to five years, that repays some or all debts on a schedule.
Your attorney will evaluate which path suits you and whether alternatives such as negotiated settlements or debt management make sense first.

What the process typically requires

Federal rules set specific steps. Most filers must complete credit counseling before filing and a debtor education course after filing to receive a discharge. The bankruptcy trustee reviews your financial documents, and creditors may object to a discharge in limited circumstances. Bankruptcy can discharge many unsecured debts, but certain obligations (for example, most student loans, some tax debts, and debts incurred by fraud) have special rules.

Protection and limits

The automatic stay halts most creditor actions - foreclosure, wage garnishment, and collection calls - while your case proceeds. However, secured creditors can sometimes move to lift the stay. Filing affects your credit report: Chapter 7 filings can remain for up to 10 years, and Chapter 13 filings for up to 7 years. Rebuilding credit typically takes time, but many people obtain credit and loans after a period of responsible financial behavior.

Takeaway

Bankruptcy is a legal tool that can stop collections and provide a structured way to resolve debts. It carries consequences, so consult an experienced bankruptcy attorney to evaluate options, handle filings, and explain local practice and federal requirements.

FAQs about Filing For Bankruptcy

Do I have to hire an attorney to file bankruptcy?
No - individuals can file pro se, but bankruptcy involves complex federal rules. An attorney reduces the risk of procedural errors, helps choose the right chapter, and represents you in hearings.
What is the automatic stay?
The automatic stay is an immediate court order after filing that halts most creditor actions, such as foreclosure, wage garnishment, and collection calls, while your case proceeds.
Will bankruptcy erase all my debts?
Bankruptcy can discharge many unsecured debts, but some obligations - like most student loans, certain tax debts, and debts from fraud - have special rules and may not be dischargeable.
How long does bankruptcy stay on my credit report?
A Chapter 7 bankruptcy can appear on credit reports for up to 10 years; a Chapter 13 filing can appear for up to 7 years. Rebuilding credit after discharge is possible with time and responsible financial actions.
What counseling is required?
Federal rules generally require pre-filing credit counseling and a post-filing debtor education course before a discharge is granted. Your attorney can point you to approved providers.