Bankruptcy Questions Answered

Esteri Maina asked:


Declaring bankruptcy is just one of the many methods that victims of extreme debts could openly make use of to survive the collections efforts from the creditors.

So many people not at all desire this method, for it is like shouting to the entire world that you are completely ruined economically.

However, those who file for bankruptcy are normally after the court ruling that discharges all or some of their debts, or gives them a reasonable plan and time allocation to pay back to the creditors.

This nevertheless is a complicated process that requires expert guidance to go through it successfully.

Generally, those who declare themselves bankrupt do so in the courts and to start with;

Let someone ease your Bankruptcy Filing

As mentioned earlier, bankruptcy-filing process is complicated and finding the best lawyer in this expertise will be a plus for a start.
His or her role is offering you guidance all through the procedure and this guarantees safety with the law.

I believe such a professional will begin the process by asking about the nature of your debts and probably how you reached a decision like this one.

If it still looks feasible to him or her, they then compile all this personal information and file the intended petition in court.

Once such documents are filed at the bankruptcy court, a trustee will be delegated to you and his task for one will be ensuring that all the information that is needed is collected from you and is truthful.

Next, alerting your creditors follows; so that they stop all actions they might be taking up against you to get your payments.

Later actions includes meeting the various parties who are involved in your bankruptcy case, together with your creditors and if probable your creditors’ lawyers.

 

It is possible to file for bankruptcy on your own even if, it is a process that would take a lot of patience and thoughtfulness.

Additionally, bankruptcy filing will depend on the type of debts you owe creditors and where among the chapters of bankruptcy code this is covered.

Chapters of bankruptcy to choose from

If you decide that you want to file for bankruptcy on your own, the first decision you have to make is which kind of bankruptcy you should file for but if you have a lawyer, this is much easier.

As a result, gathering information to be able to locate which one suite you best become an obligation for you.

Commonly, people choose either chapter 7 or 13 of bankruptcy, which are bit different.

If your choice is chapter 7 bankruptcy, you need a helping hand of a professional supposed to take you through this.

Chapter 13 or wage earners plan best suits those with a regular income each month, and they are allowed to select their own repayment plan to the creditors that they deem fair and affordable.

To begin the cases, the debtor files a petition with the bankruptcy court serving the area where the individual lives or where the business debtor is organized or has its major premises or prime assets.

In addition to the petition, the debtor must also file with the court: list of assets and liabilities, current income and expenditures, a statement of financial affairs and a list of contracts to be executed and payable leases.

Note: use the information in this article to widen your knowledge in filing bankruptcy. The real process in the bankruptcy courts may stipulate more requirements not mentioned here.

 

 

 

 



Bankruptcy Questions

Dave Dinkel asked:


The filing of a Bankruptcy is a serious action to take to stop or more correctly, stall a foreclosure which will have long lasting ramifications. The myth that filing bankruptcy stops a foreclosure must be closely examined to look at the benefits and ramifications of this court action. We will only discuss a Chapter 13 Bankruptcy here as it is the best type for 99% of all personal filings with the intent of stopping a foreclosure. Consult your attorney for more specifics on Chapter 11 and Chapter 7 filings.

Carefully looking at how a bankruptcy filing (petition) and proceeding work will help resolve whether filing a bankruptcy will actually stop a foreclosure. Chapter 13 bankruptcy allows the person filing to work out a repayment plan that extends over a 36 to 60 month period. The amount of the repayment is based on the income of the “petitioner” and can substantially eliminate certain debt. But this debt is only non-exempt items which are not fully collateralized by an asset. Such collateralized assets include autos and homes.
What happens is the petitioner petitions the court to accept his Chapter 13 filing. It does not have to be accepted by the court, but if it is accepted, the court appoints a trustee who determines a repayment schedule. The petition does not have to be accepted if the petitioner filed too recently or if his assets don’t qualify. If accepted, the trustee begins his work of determining how the monies from the homeowner will be distributed to his creditors. As soon as the filing is accepted, the petitioner (homeowner) no longer has the ability to sell any of his assets without the trustee’s authorization. Assuming you want to stop your foreclosure by filing bankruptcy, you will temporarily lose your ability to sell your home without the trustee’s approval.

If you find a buyer, the trustee will allow the sale, but only if he can be convinced the price is at fair market value (FMV). He usually needs an appraisal, because homeowners could sell their assets below market value prior to or during their proceeding. It is the trustee’s responsibility to make sure this doesn’t happen by checking bank statements and the public records back six months and sometimes longer. If such a sale took place, the trustee could have the deed voided and the sale reversed. This would be very inconvenient and costly for the new homeowner (buyer) and the petitioner (seller).

Lenders know that many homeowners will file bankruptcy because attorneys advertise so heavily and the homeowners do not understand the legal process. When the lender gets notice that a bankruptcy has been filed by the homeowner, they immediately instruct their attorney to petition the court for its release from the bankruptcy filing. A special hearing will be scheduled so there may be a few days delay in your having to leave your home. However, when the court hears the lender’s petition to release the home, the court will approve it. Now the homeowner has a bankruptcy to contend with, and his home will be back on track to be foreclosed on and later sold by the lender.

If the lender, trustee and the petitioner (homeowner) agree, the “reinstatement amount” to bring the loan current can be added into the bankruptcy payoff schedule. However, if the homeowner misses a scheduled payment to the trustee, or misses his mortgage payment, his home will be released from the bankruptcy and the lender will continue the foreclosure. The homeowner has effectively delayed the sale of his home for a few months but the bankruptcy did not stop the foreclosure, it only postponed it.

The larger consequence of the home being released is that the homeowner will have a bankruptcy on his credit report for ten years instead of seven years for a foreclosure. Actually, the bankruptcy is a matter of public record for 20 years and will stay on the individual’s credit report under “Public Records” for up to 20 years. These public records can easily be accessed by future employers, so don’t omit this information if asked on a job application. So bankruptcy is a very short-term fix to delay foreclosure, but it has very long-term consequences. Consult an attorney for more complete information if you have any reason to believe bankruptcy may be an option to resolve your financial issues.



Bankruptcy Questions

Neil Robertson asked:


If you are considering going bankrupt, then you are obviously in a very serious debt situation. Bankruptcy may not be the best solution for you, so it is very important to consider the alternatives and get qualified debt advice.

What are the Consequences of Going Bankrupt

In the UK, the consequences for bankrupts are quite severe. You will have your bank accounts frozen, you will have to sell any major assets that you own (house, car etc.), and you may have to pay some money each month out of your income to the insolvency service (this is quite rare). Certain professions do not allow you to be a bankrupt, e.g. accountancy or police.

You will not be able to obtain credit whilst you are bankrupt and you will find it extremely difficult to obtain once you have been discharged from your bankruptcy.

There is a risk of a criminal conviction if the investigation into your finances finds that you were reckless in the way that you got into debt (e.g excessive gambling etc.) and had no intention of paying it back. These types of convictions are quite rare and will only be applied in the most serious of circumstances.

What are the Benefits of Bankruptcy

Bankruptcy is the quickest route to becoming debt free. Once you have presented your petition and been declared bankrupt you will immediately be free of all your unsecured debts. This compares favorably with the timescale for an individual voluntary arrangement that can take 5 years or more to clear your debts.

Alternatives to Bankruptcy

If your situation is serious enough to consider bankruptcy then the only realistic alternative that will resolve your debt problem in a reasonable time is the Individual Voluntary Arrangement (IVA). This is suitable for people that have a profession that will not allow bankruptcy and also makes it more likely that you will be able to keep your home. As previously noted it will take longer to resolve your debt problems (5 years is the standard period but this can be shortened by making a lump-sum payment from a remortgage). There will be no investigation into your finances other than the proposal that the Insolvency Practitioner puts forward to your creditors.

Making the Decision Between Bankruptcy and an IVA

You should always seek qualified advice when deciding between bankruptcy and an IVA. The following is offered as guidance only:

You should try to arrange an IVA if: You have significant assets that you want to protect. You are in a profession that doesn’t allow you to be bankrupt. You are worried that your conduct might leave you open to criminal conviction.

You should consider bankruptcy if: You don’t own you own home. Your job is not money related and there are no known restrictions on you becoming bankrupt.



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ebet sanders asked:


The myth of bankruptcy and redemption simply that the bankruptcy stopping ransom. Closer examination shows that it may not be quite true. Bankruptcy is a serious action taken to a tent redemption, which will have long-term consequences.

In particular, chapter 13 bankruptcy allows the person filing for work-one of the repayment plan, which extends over 36 to 60 months. The sum payments based on income from the “Claimant”, and he can essentially eliminate some debt. But this duty, not only exemption from matters that are not entirely collateral, such as cars or homes.

What happens is the applicant petition the court to recognize its Chapter 13 filing. It should not be taken, but if it is accepted, the court shall appoint a guardian, who determine the timetable for repayment. The petition should not be accepted if the applicant has filed more recently, or if its assets are not. If accepted, the Governor of starting its work in determining how the money from the landlord would be distributed to its creditors. Once the filing was made, the petitioner (homeowners) already has been unable to sell any of its assets without the permission of a guardian. If you want to stop your redemption by filing bankruptcy, you will temporarily lose their ability to sell their homes without the approval of Trustees.

If you find a buyer, the sale will enable the trustee, but only if he could be convinced, the price at fair market value (FMV). He needs to be assessed, because homeowners can sell their assets below market value prior to their registration. He is a trustee of the responsibility to make sure that does not happen, checking bank statements and the state archives back six months, and sometimes longer. If such a sale has taken place, the trustee may have to deal cancelled and selling reversed. That would be very inconvenient and expensive for new housing and the applicant.

Creditors know that many homeowners will file bankruptcy, as lawyers’ advertising so much, and homeowners do not understand the legal process. Where creditor receives notification that the bankruptcy was filed by the homeowners, they immediately instruct their lawyer to apply to the courts for his release from the bankruptcy filing. A special hearing will be scheduled, so there may be several a day in your delay without leaving his home. however, when the court hears petitions for the release of creditor homes, the court will approve it. landlord has now face bankruptcy, and his house will be on track to be sold.

The more the result of the release of the home is that the housing will have on its bankruptcy credit report for ten years instead of seven years for redemption. In fact, bankruptcy is a public registry for 20 years and will remain on each credit report, in accordance with the “Public Records” for up to 20 years. Before bankruptcy is a very short-term fix with long-term consequences. Consult a lawyer as soon as you think, bankruptcy may be an option for more information.

If you are looking for more information on personal bankruptcy, bankruptcybest.info or any other issue on bankruptcy please visit this links.



Bankruptcy Questions

Peter Gitundu asked:


Bankruptcy is a situation in which an individual who is unable to pay his debts goes to court and files a petition. Depending on the financial position of the debtor, the court can decide on the best chapter for the individual to file the case. There are mainly two chapters under which individuals can file a petition; the liquidation chapter and the wage-earner chapter.

There are several things that the debtor should expect once the bankruptcy court has accepted the petition. The debtor must be willing to share with the court officials and his lawyers how he got himself in this situation. This means, recounting every detail of the debtors current financial position. The debtor should as such be ready for questions from these people and be ready with appropriate answers.

The debtor should also expect to lose all their credit cards unless they have fully paid for them. It also becomes hard for the debtor to find loans to pay for mortgages and other loans to acquire essentials such as automobiles. In case they get lenders willing to lend them some money, they will have to pay huge amounts in interest rates which could also escalate with time. During the bankruptcy period, the debtor is expected to continue making other monthly payments such as students loans and alimony.

Financial distress is a stressing period for an individual. It is wise for one to look at other possible ways of coming out of it before taking it as the only option that they have. Consult financial experts on other options that could be available and then weigh them to see what is best for you.



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Peter Gitundu asked:


Bankruptcy can happen to anyone, anywhere. There are procedures that you need to follow when you find yourself not in a position to remain committed to your financial obligations. The procedure is relatively the same the world over.

Before filing for bankruptcy, it is highly advisable that you get to weigh all the other available alternatives that you could have at your disposal. These include writing to your creditors and explaining your position. You then make an agreement with them on how you are going to repay them bit by bit. To be on the safe side, you need to have a lawyer present. This is because, if your creditors default on the agreement at some point, you will have a legal representative who will deal with the situation accordingly.

Supposing this option fails and you realize that the only way out is to file for insolvency, you need to be well versed with the law. Get to understand that there are different chapters under which you can file for insolvency in the United States. They are chapters 7, 9, 11, 12 and 13 and they all apply in different capacities to different scenarios.  

As an individual, it is more advisable to file under chapter 7 or 13. Chapter 7 requires that your assets be liquidated and the proceeds distributed among the creditors. If you wish to retain some valuable property, you are highly advised to have it exempted from bankruptcy way before you file the petition.  Chapter 13 on the other hand is more appealing for people with a regular source of income. It is from this income that you are required to make regular payments to your creditors till the bill is settled. This can be done for up to five years.



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