Debts and Property
When filing for bankruptcy, one of the greatest concerns individuals have is whether or not their assets will be liquidated to satisfy creditors. While some Chapter 7 cases do allow for some asset liquidation, the vast majority of your assets will be protected by exemption laws. Typically, only disposable income or the sale of non-essential assets are used to satisfy Chapter 7 debts. In most instances, bankruptcy exemption laws safeguard your home, automobile, clothing, and furniture, as well as essential funds such as retirement benefits or insurance. In a Chapter 13 proceeding, debts are repaid and consolidated. Since these debts are repaid, there is no risk associated with asset liquidation, unless you cease making payments in accordance with your debtor's plan.
In light of the fact that bankruptcy exemption laws offer a broad range of protection in Chapter 7 cases, filing for bankruptcy offers more benefits than risks. First, bankruptcy halts all credit collections, wage garnishments, repossessions, and foreclosures immediately. The protection afforded by bankruptcy prevents creditors from contacting you or attempting to collect debts outside of bankruptcy. Also, bankruptcy can assist you in resolving your debt issues so that you can resume your path to financial independence.
Credit Worries
Another of the major concerns surrounding bankruptcy is the notion that it negatively affects credit. This is not true. Unpaid debts, late or delayed payments, and delinquent account balances are what harm your credit. The average bankruptcy petitioner has had problems with their debt accounts for years prior to filing, which means that the damage has already been done.
While bankruptcy does not negatively impact your credit score, it can make obtaining future credit more difficult. Nonetheless, there are still advantages to be gained. First, bankruptcy eliminates negative account histories, allowing you to begin reconstructing credit from scratch. In addition, the difficulties associated with obtaining new credit after bankruptcy will limit you to lines of credit that you can afford. Since you won't be able to open secured or high-limit accounts, you'll be more likely to avoid trouble and concentrate on developing good money management skills.""
" - https://www.affordablecebu.com/
