Deciding to file for bankruptcy may be the most serious financial decision a person will ever have to make. Bankruptcy states there are numerous reasons that impact and influence someone's path that results in bankruptcy from loss of income and traumatic family issues to natural disasters with many situations in between.

After reviewing all potential avenues to correct financial problems has ended with filing for bankruptcy, people need to understand the process. The first step is to understand and determine which chapter of bankruptcy, 7 or 13, is best for their circumstance. The recent changes by Congress regarding bankruptcy laws have had the biggest impact on Chapter 7. Chapter 7 erases almost all types of debt with no repayment to creditors but now people will no longer be able to retain their homes. Chapter 13 affects individuals who have some means to work out a payment plan to creditors, albeit at a much reduced rate. Payment plans are made monthly through a court magistrate and range from three to five years in length. Unlike Chapter 7, those in a Chapter 13 filing are allowed to retain certain assets with their home being the primary one.

San Diego Bankruptcy states that individuals can file for bankruptcy on their own but the process is not easy and there are many forms to both fill out and assemble for the courts. There are also filing and legal fees to be paid. The least stressful path is to engage a San Diego Bankruptcy Lawyer who will represent their clients and handle all of the necessary legal paperwork. The attorney will also accompany clients to all required meetings with the court magistrate and, if needed, with a judge.

Individuals will need to have documentation of all income sources, bank statements, investment or retirement account statements, proof of employment, credit card statements, medical bills, and a listing of all monthly cash outlays.

San Diego Bankruptcy Attorney states that once a bankruptcy has been filed the listed creditors will be notified by the courts to cease collection actions pending final court decisions. The entire bankruptcy process from start to finish may be as short as one month with one appearance before the court magistrate or as long as several months with more than one appearance depending on the courts' request for additional documentation and testimony.

Under Chapter 7 there will be no outstanding credit debt with the exception of any owed taxes or student loans. Under Chapter 13, the filers will be providing the majority of disposable income to the courts that will leave less than $100 monthly for an allowance.

Bankruptcy is not an easy situation to go through but it does provide financially stressed individuals with the opportunity to straighten out their monetary problems and have a path to rebuild their lives and credit standings for the future. It is a painful experience with a positive future outcome.