Posted by Nicholas Hall
For some people, filing personal bankruptcy is the only way they can find their way out of overwhelming debt. Whether your debt is the result of not being able to pay your bills because you were laid off work or the result of poor financial decisions, there are a variety of things to consider before actually filing personal bankruptcy. When you first consider this option, you will need to decide if Chapter 7 or Chapter 13 will fit your needs better. As well, there are a variety of debts that cannot be included in your settlement.
Chapter 7 requires that a trustee sell off your nonexempt assets so that your debt can then be repaid. With Chapter 7 bankruptcy, there is the risk of losing your home, along with a majority of your other personal items. Therefore, before filing Chapter 7, it is important you have a full understanding how Chapter 7 works. When it is all said and done, if you file Chapter 7, you will no longer have your overwhelming debt.
Chapter 13 varies quite a bit from Chapter 7 bankruptcy. Chapter 13 requires that a portion or all of your unsecured debt is repaid. A repayment plan is established through the court. Payments can be made over a period of 36 months to 60 months, depending on the amount of the debt. The repayment amount is equal to or greater than the amount would be should you have chosen to go with Chapter 7 and liquidated your assets.
Click here to read the full article.
The article gives a basic idea on bankruptcy in a very simple way. The article has explained why you need to file bankruptcy, what the types of bankruptcy are and which type of bankruptcy plan you need to resort to under certain circumstances. If you are indeed in real bad financial situation, you may have to resort to bankruptcy. In Chapter 7 bankruptcy, your property is liquidated so as to pay the dues of the lenders. Again, in Chapter 13 bankruptcy, a debt repayment plan is offered to you. Depending on your specific financial situation, you need to file a particular type of bankruptcy.
ReplyDelete