Some Americans are forced to file for bankruptcy because credit card debt relief or elimination are not viable options. Before contemplating this option, they may have tried numerous other solutions, such as credit card counseling or consolidation.
People's reluctance to contemplate bankruptcy is understandable given its negative reputation. Often, declaring bankruptcy would be the last resort. Unfortunately, there are instances when a consumer has no remaining options. A person contemplating bankruptcy should first consult with a bankruptcy attorney. The attorney will describe both the process and the disadvantages of filing for bankruptcy.
The attorney will be able to explain the various bankruptcy options and how they vary depending on the individual's financial situation, as well as the likely outcome. The attorney will discuss the decrease in creditworthiness and credit scores, in addition to other long-term effects. He will inform them of which of their assets will be impacted by bankruptcy and which will not.
Federal law governs insolvency procedures. Federal Bankruptcy Courts have exclusive authority over the issue. Typically, consumers can choose between two varieties of bankruptcy. The bankruptcy options are Chapters 13 and 7. The Chapter a consumer should file under depends on a number of factors, including their financial situation and desired outcomes.
A debtor is able to restructure their finances and establish a repayment plan thanks to Chapter 13 provisions. Typically, repayment agreements last approximately five years. The court will designate a trustee in bankruptcy to this case. The trustee will be responsible for overseeing and managing repayments in accordance with the plan. Generally speaking, Chapter 13 filers are not required to surrender their assets.
Chapter 7 bankruptcy entails the liquidation of nearly all of the debtor's assets and personal property. All of the debtor's assets will be liquidated to repay the creditors. In most instances of liquidation, insufficient funds are generated to pay off all of the debtor's obligations. The majority of creditors will not contest this type of bankruptcy, which typically results in the discharge of the majority of the debtor's obligations. The individual who owed the money is no longer responsible for repaying it.
In order to initiate the bankruptcy process, a debtor must submit a """"Petition for Bankruptcy"""" with the court of proper jurisdiction. Once a petition has been filed and a stay has been issued, a creditor is prohibited from attempting to collect money from the debtor. As long as the stay remains in effect, your creditors are legally prohibited from garnishing your wages or bank account, seizing your property, initiating or continuing legal action against you, or even calling you. This stay can be applied to both Chapter 7 and Chapter 13 cases.
Bankruptcy can be challenging and may not yield the desired results for the debtors. The results will have a negative impact on the debtor's long-term financial situation.""
" - https://www.affordablecebu.com/
