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Bankruptcy - Is It For Me
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Used Car Bankruptcy Loans for People who Filed for Bankruptcy
Used car bankruptcy loans are available to persons who have recently filed for bankruptcy. There are many business enterprises extending bad credit used car loan programs to people who have faced bankruptcy, foreclosure, and repossessions. Car dealers themselves may provide the loan, or you can get it from other sources.
Once a person is declared bankrupt, it is vital for him to establi... Read bankruptcy article
Why Personal Bankruptcy is a Wrong Option
An increasing number of retired people are finding themselves faced with more debt than they can handle, and are faced with a decision: is bankruptcy a solution to their financial problems?
Many people find that when they retire their income decreases and they find themselves using credit cards and bank loans to pay their monthly expenses. On a fixed income it is difficult to make the p... Read bankruptcy article
Bankruptcy - Is It For Me
I have friends who have spent most of their working lives treading water when it comes to finances. Everytime their income increases (raise, new job, etc.) they add another debt. Everytime their income decreases they begin racking up credit card debt to make their monthly payments. The latter is so common there is even a term for it; it's called "subsistence living."
Most people who tread this financial water are able to dig themselves out if given enough time. But what happens when the income takes too big a hit or debt grows too high (unforseen medical expenses, etc.). That is when you might consider taking advantage of the Bankruptcy Code. Bankruptcy is a process under federal law designed to provide financial relief to the debtor by resolving and settling debts, and provide protection to creditors. There are special courts set up for administering the bankruptcy laws under the Bankruptcy Code. Bankruptcy is not designed to give creditors everything they would have been entitled to had bankruptcy not been filed. Instead, bankruptcy is intended to provide the debtor with a fresh start in his or her financial affairs while allowing creditors to recover at least a portion of what is owed.
The Rules Under Liquidation The Bankruptcy Code allows anyone who is a resident, domiciled, conducting business, or owns property in the United States to file bankruptcy. This applies to those who are U.S. citizens or have a greencard. Recent legislation has severely restricted the ease with which a debtor may file bankruptcy so you may want to consult a bankruptcy lawyer before filing. The debtor does not have to show that he or she is insolvent (i.e. can't pay the bills) to qualify for bankruptcy, but if the debtor has had a case dismissed for lack of cooperation the debtor is prohibited from filing again for a period of 180 days. This provision is designed to prevent debtor's from stringing out creditors by having a case dismissed multiple times.
Automatic Stay Once the debtor files for bankruptcy protection an "Automatic Stay" goes into effect. This means that all collection actions taken by a creditor must immediately cease. The Automatic Stay applies to all creditors whether they know about the bankruptcy or not.
One common scenario is when a home is foreclosed on and set for auction. I have been at the courthouse steps on more than one occasion to bid on a foreclosed home when the court clerk received a telephone call from the bankruptcy court instructing that the auction be cancelled due to bankruptcy filing. Many debtors, in fact, wait until the day and hour of the foreclosure auction before filing bankruptcy realizing the filing will prevent sale of the home. Even at this late hour the Automatic Stay goes into effect.
Order of Adequate Protection This does not mean that the debtor does not have to pay for the home. To the contrary, the bankruptcy court will draft an order of adequate protection to protect the creditor. If the debtor wants to keep the home, the order will direct that the debtor bring all arrearages current and continue monthly payments during the course of the bankruptcy proceedings. If the debtor fails to make the payments as provided in the order the credior can apply for a default and have the Automatic Stay lifted to pursue the foreclosure action.
Financial Documents If you file for bankruptcy protection you will be required to provide financial and legal forms showing your assets and liabilites. Do not try to hide assets. If you are found to have obtained a bankruptcy discharge while hiding assets, the court will reopen the case and severly penalize you for your fraudulent misrepresentations.
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Bankruptcy is not the best debt solution
When people are flooded with debts, and they see no way out of their situation, they start thinking bankruptcy could be the only possible solution towards a debt free life. Almost all debtors are not aware of two main points about bankruptcy:
- Bankruptcy is not a wise method for debt solution - Bankruptcy brings noxious consequences, affecting financial and social status
Here is a list of the aforementioned noxious consequences:
1. A bankruptcy filing remains on a Credit Report for as long as 10 years, and it also stays on Court Records for as long as 20 years. Thanks to this, your chances of getting a loan and even a job again, will be minimal.
2. You can also lose valuable assets when filing for bankruptcy, or you have to pay the equivalent in money.
3. As we said before, your financial and social status will be deeply affected. People tend to loose faith upon someone who has filed for bankruptcy.
4. If a business owner files for bankruptcy, he will suffer the same consequences as any other person who has filed for bankruptcy. He will not qualify again for a business loan.
5. After declaring bankruptcy, your bank accounts will be closed, credit cards, and everything that has been bought on hired purchase, such as a car or a house will be returned to the owner.
People really need to understand how the bankruptcy process works in order to use it as a last resort, and not as an easy way out.
Not true about Bankruptcy
- Bankruptcy will not get rid of all of your debts. There are some debts that cannot be canceled, such as tax claims, alimony, child support, among others.
- Although bankruptcy relieves the pressure of debt, it still leaves so many consequences that it does not feel like a fresh start. Because of this, bankruptcy is considered a temporary relief.
- Bankruptcy laws are rigorous about including all your accounts. You will not be given the chance to hide any account from the bankruptcy process.
- Bankruptcy turns you into a debt free person at the cost of your assets, either by liquidating them or by putting you into a new payment plan.
Remember, you can always choose and try many different solutions to become debt free; but one thing is for sure, Bankruptcy should only be used when other options fail to work; use it as last resort.
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Bankruptcy - Is It For Me
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