If you are in a bad financial situation where you feel there is no hope for you to recover, bankruptcy might be your only option. People who have lost a job or don’t have enough income to cover all of the growing expenses may need to consider the different options that they can take. If you are going to apply for bankruptcy, you may be required to get bankruptcy counseling before you can file.

Most courts will require people who are applying for a bankruptcy to get a bankruptcy credit counselor. These counselors will need to be approved by the court. If you fail to meet the requirement of getting a bankruptcy counselor, you may have to start the approval process all over again. Even if your bankruptcy is not a result of financial mismanagement, counseling is often required by the courts.

Most courts will give you a list of different credit counselors that are approved. Before you see a counselor your need to make sure they are approved by the courts. You can often get the courts to approve most counselor you choose; you just need to contact them. (more…)

Everybody has financial problems at some time. Occasionally life slaps you down from numerous directions at times that couldn’t be any more untimely, and you require help as soon as possible. Combine these knocks with the dismal times that we’re presently encountering in this American economy, and it can be a frightening time to struggle to make ends meet. The principal factor to deal with when you’re confronting grave financial distress is to take the whole thing into account before you do anything hasty, since in the majority of cases a firm measure of will power and discipline could get you through the tempest. However, there comes a stage when bankruptcy develops into the only practicable alternative, and it’s at this moment that you have to be certain that you have all your bases covered.

There are numerous gauges to be watchful for that might warn you that you are on the path to bankruptcy. Following are some subjects to examine and evaluate with your present financial circumstances. If you see yourself accurately illustrated by a number of these issues, then it might be the time to meet with a bankruptcy attorney and work out what your subsequent steps ought to be.

1. Repeated overdraft fees. Everyone gets overdraft fees from time to time. But, if you find that you are overdrafting on an extremely frequent basis, you should inspect your bills along with your living expenses to find out whether you’re living beyond your means, or if you’re completely incapable of producing the funds required to cover your expenses and debt. (more…)

The American economy has been largely built on a consumer population addicted to and reliant upon credit. Big ticket items like cars, appliances, furniture, and homes have been purchased on borrowed money for decades and it has gradually become the norm to overspend and to utilize the once sacrosanct credit cards for day to day purchases. This has spiraled outward for many people into an overall attitude toward and handling of money that has left them scrambling or unable to make ends meet. When financial obligations are greater than you can afford, it may be time to consider filing for bankruptcy protection under the chapter of the Bankruptcy Code suited to your debt and asset situation.

Making the decision to enter bankruptcy is difficult, primarily because there is a longstanding social disapproval of the practice. But as more individuals and businesses find themselves struggling to cope with unemployment, stagnant wages, and rising interest rates on mortgages, credit cards, and other financial instruments it is becoming an unspoken and necessary step for many. The matter is further complicated by intentional disinformation put forth by debt collectors and other entities and the presence of countless finance gurus and laypersons who offer their opinions unsolicited and sometimes with serious misunderstandings about the subject at hand. (more…)

The Bankruptcy Abuse Prevention and Consumer Protection Act of 2005 (BAPC), brought about a few changes to the current USA bankruptcy laws, but in essence the structure of the 1978 Act remains the same.

Bankruptcy is a legal procedure that protects an individual or business that cannot pay its debts; it also protects the creditors. These legal proceedings may be:

• Voluntary, which is initiated by an individual or business unable to pay its debts.
• Involuntary: where the creditors take action, provided they prove the individual or business has debts in excess of $5,000.

Resolution

Once the petition is filed, the court will decide under one of the three following means:

Chapter 7 calls forliquidation; that is the sale of the assets of the debtor and the proceedings of the sale used to pay the claims of the creditors. Excluded from this chapter are railroads, banks, insurance companies, or government units. The act specifies that secured creditors have priority over unsecured creditors.

Chapter 11 calls for reorganization; that is the individual or business is given 120 days to present a reorganization plan that eliminates the factors that cause the distress. Such plan must be confirmed by the court. In many instances the plan works and the bankrupt individual or business comes out stronger and ready to function on its own once again. Federated Department Stores, Macy’s, Texaco, and some airlines are examples of reorganization. (more…)

If you’ve got a lot of debt, you may be thinking that bankruptcy is your only option. But, don’t file that bankruptcy petition just yet. These six steps may be all you need to stay out of bankruptcy and get your finances under control.

1. Write out all your monthly expenses, in detail.

Do you have a mortgage or an auto note? If so, what is your interest rate? How much are your monthly payments? What is the outstanding balance on those loans? List them, in full detail.

Next, write down all your necessary monthly expenses. These expenses include things like electricity, telephone, insurance, food, etc. You should know how much you spend each month on all of these items.

After surveying your necessary monthly expenses, take a look at your discretionary monthly expenses. Discretionary expenses are those things that are optional. You don’t have to have them. But, you may enjoy them. Representative discretionary expenses include entertainment, eating out, club memberships and any impulse buys you make in a given month. (more…)

If you are caught up in a bad debt maze and are looking out for ways to get rid of them there are couple of alternatives from filing bankruptcy. IVA is an alternative to bankruptcy filing and helps those who are in bad debt problems. If you are unable to meet your multiple loan payments, credit cards bills and are being harassed by the creditor’s collection calls then you must consider IVA.

IVA is an individual voluntary arrangement used as a financial solution to allay debts. It helps those who owe money, repay a percentage of their loan amount to their respective lenders and credit card company. This will be paid up to 5 years and any amount left after that will be nullified. In other words your pending debt after five years will be considered as settled debt. This Individual voluntary arrangement is signed in front of a licensed insolvency practitioner (IP) and the parties involved are borrower and lender. It is a formal agreement signed by both the consenting parties.

It helps to manage your debts wisely and systematically. You need not face any public embarrassment as there is nothing published in the newspaper about your debts unlike bankruptcy filing. You can still apply for another loan despite of facing an IVA. This is a distant reality in case of a bankruptcy filing, no lender will risk his loan amount. It is the most achievable and most affordable way of getting rid of debts. This agreement between the two parties, creditors and debtors will be kept confidential and private only to the parties. (more…)

Bankruptcy should be considered only when the borrower is unable to return the money that he owes to different lenders. A lender may compel the borrower to sell his property, shares or any other assets to clear off debts and to repay the entire due loan payments to the lender. File for bankruptcy in an attempt to resolve a hopeless financial situation. Do you want to lose your property and face public embarrassment? Thousands of people in debt have lost their house, car and other assets after filing for bankruptcy. Bankruptcy has a bad stigma and is publicly advertised, in order to avoid this you must stop yourself from filing bankruptcy.

You must consider the various alternatives to bankruptcy to save yourself. Before agreeing to or signing on anything just make sure that you have read the whole document and are fully aware of all the consequences. No bankruptcy alternative should be considered with out considering expert’s advice. Seek for experts advice and solutions to avoid bankruptcy. (more…)

The outdoor and leisure clothing retailer Blacks is planning to resolve its financial difficulties by agreeing a Company Voluntary Arrangement (CVA) with its creditors. Yet more evidence that creditors are starting to understand the value of CVAs for restructuring struggling companies.

According to recent reports, outdoor and leisure clothing retailer Blacks Leisure, (Blacks, Millets and Free Spirit) is likely to agree a Company Voluntary Arrangement with its creditors within the next few weeks. This agreement will allow Blacks to close unwanted stores, and gain the support of its creditors to survive.

What is a CVA?

In simple terms a CVA is an agreement where a company’s creditors decide to accept reduced payments and write off debt. This releases the burden of debt on the struggling business and frees up cash to enable it to continue to trade. As a result of the CVA, creditors not only agree that they will write off a certain amount of the money that they are owed. They also have the opportunity to continue to trade with the company into the future. This is certainly a better prospect than the total failure of the business and the likelihood that there will be no returns for creditors at all.

Why has CVA had bad press?

Not uniquely among business recovery service solutions, CVAs have attracted some criticism. Creditors argue that they are forced to accept the terms of a CVA because if they do not, they are threatened with the closure of the company and that they will be left with nothing. In reality this is a flawed argument because a company would only consider a CVA in the first place if it is struggling to repay its debts and facing liquidation. If this situation were allowed to happen, the creditors would lose everything anyway. (more…)

On October 1, the latest set of economic indicators seemed to be yet another sharp reminder that the US economy is in for a tough time over the years to come. With higher unemployment figures (although a slowing of job loss number is expected) and slowing manufacturing data, it should come as little or no surprise that people with debt trouble are going to look at bankruptcy as a way to escape the financial pressures facing them.

With many people right now still on pins and needles where their employment is concerned, Chapter 13 Bankruptcy might not be the great solution the American Government intended for it to be. While it may be nice to retain control and possession of important assets, the demands will continue to exist that any structured debt program under Chapter 13 be adhered to. Consequently, Chapter 7 bankruptcy filings should be expected to rise. (more…)

The Bankruptcy Code gives homeowners facing foreclosure the right to cure the default any time up until the foreclosure sale process is completed. The key word here is “process,” and state law determines what the process is for a valid auction or sheriff sale. Until this has been completed, homeowners who file bankruptcy can use the federal laws for another chance to save their home and cure the default.

The Bankruptcy Code itself does not even determine when a house is considered “sold” for the purposes of a valid foreclosure sale. This means that state foreclosure laws will most likely be used in cases where borrowers attempt to pay off a loan through bankruptcy, even after a sheriff sale. Another aspect that works in favor of homeowners is that many states require an auction to be confirmed before it is valid.

This means that homeowners who file bankruptcy have rights during the foreclosure process that are safeguarded at least through the sale of the property. These rights may be guaranteed for even longer than that, depending on how the confirmation process of the auction works after the home has been sold by the courts. If there had been a bankruptcy, the lender may not just be able to sell the house and take it over right away.

Redemption rights may extend the rights of the borrowers even longer. In states that have a redemption period, the borrowers are given a set period of time in which to cure the default even after the home has been auctioned at a trustee sale. But for those homeowners in states where a redemption period is not available, filing for bankruptcy may create a pseudo-redemption period through the right to cure.

However, rulings by state courts on this issue may determine how long this extra right to cure lasts. Some courts have ruled that the foreclosure sale process is completed once the gavel falls at the auction. In these cases, filing bankruptcy will not extend the time to cure the default for any significant period of time. Once the auction has been conducted, the sale process is complete, and the right to cure has expired (more…)