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If so, you have come to the right place. Bankruptcy does not just affect people in Houston, Texas. There is a reason bankruptcy lawyers can be found everywhere. This information should be helpful no matter where you are in the United States. I will quickly go over some of the basics of personal bankruptcy in this article and try to dismiss some of the common misconceptions associated with it.

First, you cannot file bankruptcy just by saying the words “I declare bankruptcy” like Michael Scott on “The Office.” It can be a fairly long complicated process, one that almost always requires the assistance of a bankruptcy lawyer. In the United States, there are two common forms of personal bankruptcy available: chapter 7 and chapter 13. Chapter 11 and 12 are sometimes available for personal bankruptcy in rare occasions. The goal of both, chapter 7 and chapter 13, is to help you eliminate your debt.

But remember it is not a get out of jail free card. Some debt may be left and some collateral may be collected. A great example of debts that cannot be discharged by filing for bankruptcy are student loans, government loans and back taxes. Chapter 7 is not only a store in Boston, Mass or Houston, Texas. It’s a form of personal bankruptcy. Just ask a bankruptcy lawyer and they can tell you all of the details of chapter 7. This type may help you cancel debts but it may also result in the loss of collateral. It is sometimes call “liquidation.”

Chapter 13 is for folks who are trying to keep their assets. It allows the claimant the opportunity to make payment arrangements for past debt, hence the term “reorganization.” You are sometimes given up to five years to pay off your debts. During this time it is important to keep up with your current payments as well as your past. If you are reading this, you may be receiving many “harassing” phone calls from your creditors. Filing for bankruptcy will make these phone calls stop. When bankruptcy is filed the court puts into place an automatic stay. This automatic stay will also stop wage garnishing in most cases.

Remember, your debt does not just disappear overnight. The bankruptcy will remain on your credit report for ten years. A lot of times, it may also cause your credit score to drop by up to one hundred points. After bankruptcy, will have a lot of work to do to clean up your credit but personal bankruptcy can help you do that with less debt. Whether you are in New York, Chicago or Houston, Texas, you should be able to find a bankruptcy attorney that can help you with your personal bankruptcy. Many bankruptcy lawyers will even do a free evaluation of your situation. When all else fails, ask a professional.