Reliable Bankruptcy Information

By: J Everett Myers

Reliable bankruptcy information is challenging to find.

Bankruptcy is one of the most difficult, ofttimes even traumatic, situation that can be faced in life. Often due to unexpected medical expenses, changes in employment or other unforeseen circumstances, bankruptcy is a last-ditch alternative for persons who face insurmountable debt, foreclosure and other harsh financial challenges.

Bankruptcy is an miserable event that can happen to anybody - from the young entrepreneur to the most experienced businessman. Since the economic landscape is ever changing, as is the stock market, thousands of persons can't say they live in complete security any more.

How it Works

Debtors file for specific types of bankruptcy for specific reasons. A debtor who files for Chapter 7 bankruptcy is generally trying to discharge all of his debts. A typical Chapter 7 case lasts about four to six months, from the petition date to the discharge date.

Chapter 7 bankruptcy is sometimes the better alternative for those whose debts, such as credit card debt and medical bills, are mostly unsecured. So, if you don't own many assets, your income is below the median, and the lion's share of your debts are not secured, Chapter 7 bankruptcy might be your best alternative.

Generally, a debtor who files Chapter 13 is employed and is trying to hold on to his assets while entering into a payment plan with the bankruptcy court in order to pay off his creditors.

The individual will make a Chapter 13 plan, where he agrees to make timely payments to the Court for a span of 36-60 months. This should ensure the debtor enough time to pay back the agreed upon debts.

Chapter 11 bankruptcy filings are sometimes reguarded as "strategic". To put this another way, management may wish to reorganize for strategic purposes, not solely for the sake of balancing books. Chapter 11 is reorganization, as opposed to liquidation. Debtors may "emerge" from a chapter 11 bankruptcy within a few months or within several years, depending on the size and elaborateness of the bankruptcy.

In all instances of bankruptcy, plans are presented, creditors vote, and the court makes thousands of reviews until a decision is reached. If the plan cannot be be agreed upon, the court may do one of two things: liquidate the business under Chapter 7 or dismiss the case.

When your plans are accepted, creditors are given priority by the court. As soon as your assets are distributed, you will be free from most of your obligations, even if your debts are not fully paid off. Creditors are repaid according to the portion they accept. The smaller the settlement, the quicker they will be repaid.

Conclusion

Bankruptcy can be a real stress relief if you are in a desperate situation, but it is necessary to understand what has brought you to that point. If you declare bankruptcy and then go on your way without changing your spending habits, you are fated to wind up in a similar situation all over again.

Declaring bankruptcy is not an easy decision, but we can help you sort out your options, review potential options, and then make a decision on how to proceed.

It is a legal chance to get a fresh start.

Want more bankruptcy information? Visit our website.

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