If you are a low-income family with few or no actual assets, you should undoubtedly file for Chapter 7 bankruptcy and discharge your debts. This requires the liquidation of your estate and the distribution of as much money as feasible to your creditors. The remaining debt is cancelled, and creditors may no longer pursue it; it must be written off.
The liens on your home and/or vehicle must be reviewed to determine if they are exempt from this procedure, and if they are not, you must decide if they should be excluded from your chapter 7 bankruptcy filing. It may be necessary to give up a home that is mortgaged for more than it is worth and has payments that you cannot realistically afford.
Chapter 13 bankruptcy may be a viable option if you have a stable income but have suffered a transient setback, such as catastrophic medical expenses or another debilitating but temporary setback. This type requires a fiduciary to manage your finances and devise a repayment plan for court approval.
Typically, the repayment plan for chapter 13 bankruptcy requires a set dollar amount to be paid on a regular basis for a specified period of time, after which the remaining balance is discharged. You and your creditors will be expected to adhere to the agreement's terms. This allows you to continue living ordinarily while giving you the opportunity to catch up on your bills and regain your stability.
Many people believe that refinancing a home after a bankruptcy will be impossible, but there are many lenders willing to give second chances in exchange for your business, and in a strange way, the bankruptcy confirms one thing - at least you aren't a risk for filing bankruptcy again, as you will be barred from doing so for several years.
In fact, individuals who declare bankruptcy frequently see an immediate improvement in their credit score. As strange as it may seem, many lenders view bankruptcy as a sign that you are attempting to turn your life around, and if you can demonstrate this over the course of a year or two, you will likely be viewed as an average rather than a high-risk loan applicant.
Self-forgiveness and the resolve to alter your life so that you never have to file for bankruptcy again are the most important lessons to learn from bankruptcy. Learn from your mistakes, teach yourself and your family better financial habits, and leave the bankruptcy behind you. ""Move forward and make prudent financial and money decisions a part of your daily life!""
" - https://www.affordablecebu.com/
