Getting To Know Basic Bankruptcy Information
Many people have chosen bankruptcy as their last resort to dealing with overwhelming debt. Eventually, the stress of having to deal with debt becomes unbearable and this may seem like the only option of dealing with it. If you are one of these individuals, here you will find some basic bankruptcy information to figure out if this is really the right option for you.
You may have a vague idea of what bankruptcy is, but do not really understand the fine details. Typically, when an individual claims bankruptcy, this individual has to go through a federal court process that will determine their financial obligations. Liquidation of assets may be used to repay debt, or if you have enough income you can opt for a repayment plan. Although there are several foreclosure types, Chapter 7 and Chapter 13 are commonly used.
Opting for Chapter 7 will put you through the liquidation process. Once you have liquidized all assets that are applicable, the amount is put toward repaying debt. Where you live, and your state’s laws will factor in what assets the government has the right to liquidize.
On the other hand, Chapter 13 you do not go through a liquidation process but offer a repayment plan that will be enforced for 3-5 years. Both of these bankruptcy instances have different prerequisites and procedures. Thus, considering your options carefully will help you make the right choice for your circumstances.
In order to file for Chapter 7 you have to an individual (consumer) or a business. This process normally lasts 3-6 months for completion. Property liquidation is assessed, and whatever assets are eligible for liquidation under your state law will be sold in order to repay debt. Once this step is complete you will be exempt from repayment of unsecured debts such as credit cards, or medical bills.
Your secured debt on the other hand is a different story. If you have a car that still owes money, the lender may repossess the vehicle. If you want to continue with your monthly vehicle payments, this may be possible if your lender agrees. You may possibly have the option of buying out the lender for the resale value of your car. All of these options are dependent on your individual situation. Find out what will work for you.
If you do not quality for Chapter 7 but do qualify for Chapter 13 this means that you make enough stable income to repay your debt within 3-5 years. Keep in mind, with any bankruptcy process, there are some debts that will not be erased with bankruptcy. These financial obligations include child support, taxes or alimony.
Keep in mind that not all dept is clear when you file for bankruptcy. There are some financial obligations that you just can not escape. These obligations include taxes, child support and alimony. Delving into bankruptcy information can help you make the right choice for your financial situation.
To get the latest bankruptcy information online. There are many different websites giving ideas for Bankruptcy status
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