There are basically 2 types of bankruptcy the most individuals
file for personal debts. The 2 most common types of personal
bankruptcy are classified as Chapter 7 or Chapter 13.
Chapter 7 Bankruptcy is the process of liquidating all
debt and getting a fresh start with no debt or money owed
to the creditors that were claimed in the Bankruptcy proceedings.
Chapter 7 Bankruptcy usually eliminates most types of unsecured
debts and is designed for individuals who have little or
no assets.
Chapter 13 Bankruptcy is a debt repayment plan which has
no interest. When a person petitions a Chapter 13 Bankrupcty
all debts are consolidated into one monthly payment which
is usually for a 3 to 5 year period. A Chapter 13 Bankruptcy
is designed for individuals who have assets that they would
like to keep. Bankruptcy 13 can a person to save a house
from foreclosure or an automobile from being repossessed.
Should I Even File Bankrupcty?
Most people don't have a clue as to whether
bankruptcy is the right option for them. When you have creditors
and collection agencies calling daily it can seem extremely
overwhelming, and most people will seek the advice from
a bankruptcy attorney. Well this is absolutely a catch 22
because guess who wants a little extra business? The Bankruptcy
Attorney of course will suggest filing bankruptcy as a simple
fix to your problems. Here is of questions you must ask
yourself before filing bankruptcy. You should go home and
do your homework before committing to filing bankruptcy.
Compile all of your credit obligations, get a copy of all
3 of your credit reports to see if you have forgotten any
past due accounts. When you all of this together start adding
them up for a grand total of your current debt. Truth is most
people have many small debts which don't add up to much. But
when you have 50 creditors calling wanting their $100, it
can seem like you are in over your head. I can tell you from
what I have seen over the years most people have less than
$10,000 in debt.
- Is there any possible way to repay these obligations?
The choice of most people is, show me the
simplest way to clear this mess up with the least amount of
effort on my part. Get your attention? It should because this
is fact! Everyone wants the simple solutions to all problems
and you will always have a bankruptcy attorney around every
corner telling you how easy it is and how grand life will
be when you are debt free. You need to do your own in depth
homework before commiting to bankruptcy. |
