Filing for bankruptcy requires careful preparation. One of the first steps in making it happen is gathering all the required documents.
Having all relevant information in one place makes it easier to grasp the total financial picture and helps ensure the process runs smoothly.
Financial statements and income verification
Start by compiling all of your financial statements and records of income. This includes recent pay stubs and business statements. Also, collect documentation regarding other sources of income, such as social security or rental homes.
Assets and liabilities
Write down your liabilities and assets. Assets include anything of value, such as real estate, vehicles, stocks, jewelry and electronics. Liabilities are debts, including credit card balances, loans, medical bills and other outstanding obligations. Doing this helps determine what you might need to forfeit and what you could be able to keep.
Tax returns
Gather your tax returns from the last two years. These records provide a historical overview of your finances. As such, they are instrumental in assessing your average income.
Bank statements
Request that your bank send you statements from the last six months. These documents provide insight into your spending habits, existing debts and how you manage your finances. They will be necessary if you need to explain large transactions or withdrawals.
Credit report
Obtain a current credit report from one of the major reporting agencies. Yours will contain comprehensive information about all your credit activities, including forgotten debts.
Additional documents
Finally, hunt down files relating to other fiscal circumstances, such as divorce decrees and school loans. These can affect your bankruptcy filing and determine your eligibility for discharging certain debts.
Assembling paperwork ahead of time makes declaring bankruptcy as seamless as possible. This task may require significant effort, but tackling it will make getting back on your feet quicker and easier.
