Bankruptcy
If you are coming to this section, it means all the information in
the previous sections, as well as reading through the money saving
ideas on the site, has failed to resolve your debt problem. If you
still can't come up with a plan to pay off your debt, your final
option may be bankruptcy. It should be an absolute last resort and
something to be avoided if at all possible. First and foremost,
bankruptcy in itself can be quite expensive. You will need to pay
lawyer, court and filing fees upfront. The entire process can take
months and you will have to endure exhaustive questioning from
creditors. Your finances will become exposed to the public and the
bankruptcy will remain on your credit record for 10 years meaning
that obtaining credit at affordable rates in the future will be
extremely difficult. Sometimes, however, certain circumstances
dictate it as the only option. There are two possible forms of
bankruptcy that may be applicable if you have reached this state.
Chapter 7 Bankruptcy is a straight forward bankruptcy that
eliminates most debts and relieves you of your responsibility of
paying most creditors. There are, however, some debts that you are
still required to pay even when filing chapter 7 bankruptcy. These
include taxes, child support, alimony, student loans, legal
judgments against you, money you obtained through false financial
statements and loans not listed in the bankruptcy filing. While
the court may force you to surrender property you own in order to
help satisfy the debt, you are usually able to keep your home,
car, tools used in your job and personal property.
In Chapter 13 Bankruptcy, unlike chapter 7 bankruptcy where your
debts are relieved, you are required to pay back all or part of
your debt. You surrender control of your finances to the
bankruptcy court which will approve a repayment plan based on your
financial resources. The plan will lasts from 3 to 5 years. During
the period of repayment, The chapter 13 bankruptcy plan provides
that you do not have to pay interest charges on the debt during
the repayment period and your creditors can not harass you for
repayment during that period.
If you find that one of these bankruptcy options is the only one
for you, then rereading this article will be of even more
importance. It will let you take a preemptive measure to get your
personal finances in order so something like this never has to
happen again.
THIS CONTENT IS FOR INFORMATIONAL PURPOSES ONLY. THIS IS IN NO
WAY GIVING ANY LEGAL ADVICE OR REPRESENTATION. THE INFORMATION
CONTAINED HEREIN WAS COMPILED FROM VARIOUS ARTICLES. FOR ANY LEGAL
ADVICE OR REPRESENTATION SEEK YOUR OWN LEGAL COUNSEL.
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