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Do You Know That Bankruptcy can

Provide a crutch to You

if You are a Risk taker and Entrepreneur?

Dear Friends,

You need to educate yourself about bankruptcy only if you have problems paying your bills, especially if you are facing garnishment or repossession, then only you should consider declaring insolvency. You should declare bankruptcy as a last resort and you should consult your attorney and weigh your all possible options. Let us review together all about the bankruptcy.

What is Bankruptcy?

• A way to temporarily suspend (during the course of the proceeding), and later prevent, all debt collection actions for debts against you at the time when you filed your bankruptcy petition.
• Once a person files for bankruptcy, the federal court grants an "automatic stay." This prevents creditors from attempting to collect on any outstanding debts. Creditors may petition the court for relief from the automatic stay. Often, creditors whose loans are secured by property are permitted to take possession of that property.

What are your Filing Options?

You may choose several different types of bankruptcy based upon the amount and nature of the debts, the exemptions available, and the types of assets you own. The different bankruptcies are named after the corresponding chapter in the code.

Option 1: Chapter 7 Bankruptcy

What Is Chapter 7 Bankruptcy?

• Chapter 7 is referred to as "straight" or "liquidation." In a liquidation, the debtor turns all of their assets over to a trustee. The trustee then liquidates (sells) all the assets and distributes the proceeds to the creditors. The person is then discharged of all debts, except those which cannot be discharged.
• Every state allows a debtor, even in a liquidation, to keep some small amount of property. Creditors must look solely to the assets held by the trustee for payment. Creditors can’t come back later and try to collect their claims from the discharged debtor. A debtor can receive a Chapter 7 discharge once every seven years.

If filing for bankruptcy is an opportunity for a debtor to emerge out of a financial crisis and start afresh, then Chapter 7 of the Bankruptcy Code is the way to achieve this end relatively faster.

How Can I Be Sure This Is The Best Way?

Also known as liquidation (converting assets into money) or a straight bankruptcy, Chapter 7 Bankruptcy is the most common form of bankruptcy filing. This type of bankruptcy filing accounts for as much as 65% of all Consumer Banking filings. This is one of the faster ways of starting afresh, and more so if there are no objections from any of the parties involved. Ordinarily, most (if not all) debts would be discharged within months of the attorney filing a bankruptcy petition.

How Does Chapter 7 Bankruptcy Work?

• A trustee is appointed who collects all non-exempt property, sells the assets and distributes proceeds from this sale to appropriate creditors. Chapter 7 is different from other bankruptcy filings because the debtor needs not make a payment to the trustee.
• Even though in some cases this would mean that you will lose all your assets, this need not always be the case. It is strongly recommended that if you are apprehensive and feel you will lose your assets, discuss the matter with your Bankruptcy Attorney.
• Under Chapter 7 Bankruptcy, the debtor receives a discharge on all dischargeable debts. There are 19 general classes of debt, such as child support, most taxes and student loans that are discharged under Chapter 7 Bankruptcy.
• An added advantage with Chapter 7 bankruptcy is that by signing a reaffirmation agreement a debtor can continue to pay for a car loan or a mortgage on their home. This agreement is in place because as per the US Government Bankruptcy Code a debtor could be allowed to retain some or all of his property.

Who Can File For A Chapter 7 Bankruptcy?

• Debtors engaged in business would usually not like the prospects of liquidation and Chapter 11 might be a better option for such individuals associated with corporations and partnerships. Also, individuals with regular income if in a debt situation would be better suited to file a Chapter 13 bankruptcy.
• Any person who has been granted a Chapter 7 discharge (or completed a Chapter 13 plan) within the last 6 years, cannot file for a Chapter 7 bankruptcy plan.

Option 2: Chapter 13 Bankruptcy

What Is Chapter 13 Bankruptcy?

• Chapter 13 debtors pay their debts through future income rather than liquidation of their current assets. This chapter usually allows the debtor to keep much of his or her property.
• Under Chapter 13, the debtor presents a plan for repayment, which is reviewed by the trustee, the creditors, and the Bankruptcy Court.
• Chapter 13 is available to those debtors with unsecured debts (usually credit cards) less than $100,000, and secured debts less than $350,000 (home mortgages and car loans).
• The plan must provide creditors with an amount at least equal to what they would receive under a Chapter 7 filing, and must be feasible based on the debtor's income. If the plan is approved, the debtor makes payments to the trustee, who then pays the creditors. Plans usually run at least three years, and cannot run longer than five years.
• Debtors remain under court supervision for the life of the plan (up to five years), and are forbidden to make new debts or sell assets without court permission.
  Debtors who propose less than full payment to unsecured creditors will be forced to live on a budget for the life of the plan and pay all excess income to the creditors.

Chapter 13 of the Bankruptcy Code provides an opportunity to repay some or all of your debts in your name, in better terms, i.e. lower or no interest. But, Chapter 13 Bankruptcy is applicable to only those debtors who have a regular income.

Who Can File For Chapter 13 Bankruptcy?

The most important criteria for a person to be able to file for Chapter 13 bankruptcy is that the individual must have a regular income. There are a few other criterions that must be met for filing a Chapter 13 Bankruptcy, your attorney will be the best person to introduce you to these!

Are you looking for some reliable bankruptcy sources?

You may like to check out the following ones which we have researched for you.

A. BANKRUPTCY CONSULTANCY OFFERS

COMING SOON AS WE ARE CURRENTLY RESEARCHING FOR GOOD COMPANIES.

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AND MANY MORE... CHECK OUT AT THE CREDIT-RELATED ARTICLE SECTION FOR VARIOUS ARTICLES!

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D. BANKRUPTCY eBOOKS

• Bankruptcy mortgage Book - this book shares how you can get mortgage after bankruptcy. If you going through such a situation, then it is certainly a good resource.

AND MANY MORE... CHECK OUT AT THE CREDIT-RELATED eBOOKS SECTION FOR VARIOUS eBOOKS!

Wishing you a very happy & successful bankruptcy settlement,

InstantCreditCardSolutions.com team

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