Dealing with bankruptcy can be complicated. The legal process itself is already tedious, and the stress you receive from your debt collectors just makes the experience a lot harder. Filing in your home country is already confusing, but imagine how hard it must be for those living on foreign soil.
Before we teach you how to deal with bankruptcy abroad, it’s essential to have a clear definition of the term. Bankruptcy refers to a legal financial status of an individual or business entity that is unable to settle its outstanding debts to a credit provider. The process is usually initiated by a debtor and done with the intention of acquiring financial relief.
Upon filing, the person’s assets will be assessed by the relevant authorities and used to pay off a portion of the remaining balance.
Filing for bankruptcy may be a great way to get more breathing room, but it’s important to note the consequences that come with it. Failure to approach things with care can make your financial situation a lot harder, so having a clear strategy is a must.
To help you out, this article will explain how you can declare bankruptcy if you are an expat in a foreign country.
As with all legal matters, it’s best to seek the services of a legal professional. The law may allow you to file for bankruptcy without an attorney, but considering the complexity of the process, doing so is highly discouraged, especially if you’ve failed to file for tax returns or dealt with other complicated issues.
Having an advisor who is experienced in bankruptcy proceedings will make it easier for you to get back on track.
There are two main forms of bankruptcy that individuals can apply for: Chapter 7 and Chapter 13.
Applying for bankruptcy means that you’ll need to file the bankruptcy petition in the U.S. But before you file a petition, you’ll be required to attend a counseling session organized by an authorized agency. The counselor will review your financial standing and let you know if you’ll need to declare for it.
If your situation isn’t bad, the counselor will likely touch on the bankruptcy alternatives that you can take. If filing is necessary, you should discuss matters with your attorney.
Once you’re done with counseling, you’ll receive a certificate of completion. This serves as proof that you’ve had your situation assessed and you’re aware of the process and possible effects of bankruptcy. Afterward, you should head to the nearest bankruptcy court to obtain the necessary forms.
Along with your certificate, you’ll need to collect financial statements. The documents you present should show all the income, debt, and assets that you’ve accumulated through the years. Hiding any important details may result in your application’s denial (and in graver cases, imprisonment), so always stay transparent.
After you’ve sent the necessary documents, you’ll be asked to submit a means test form. This assessment will help the judge determine which type of bankruptcy you’re qualified for. If your income is stable enough, you will have the option to apply for Chapter 7. In case your income is a bit low, you will be required to file for Chapter 13.
Upon completion, the trustee of your case may organize a meeting with creditors. People or entities that you owe money to may inquire about your current financial situation and the plans you have on repaying them, so be prepared to provide answers.
After all is said and done, your case will be reviewed by a bankruptcy judge. All the information you’ve supplied will serve as the basis for his decision, so do not attempt to hide or tweak any crucial details.
If your application gets approved, all the debt that you owe will immediately be discharged. However, keep in mind that some dues, such as student loans and taxes, are not included. In case you’re facing tax problems with the IRS, you should consider acquiring tax resolution services.
Dealing with bankruptcy can be overwhelming, but it doesn’t have to be when you know the steps you are taking. As long as you’re fully aware of your situation and understand the measures you can take for relief, settling balances can be done with ease.
In case your situation is a bit more complex, seeking the advice of experts will be one of your best decisions. Get in touch with a reliable tax resolution partner and visit our page today!
