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…)

Your children rely on regular child support payments for all kinds of necessities: food, clothing, shelter, medical attention. It’s every parent’s responsibility to care for his or her child, and child support payments are a way of enforcing a non-custodial parent’s debt to his or her children. So what happens when the person supposed to make the payments files for bankruptcy? Will it put your children’s welfare into jeopardy? Can your children afford bankruptcy?

Fortunately, even during bankruptcy proceedings, a parent is still required to make his or her court-ordered child support payments. The welfare and care of the children is considered a top priority under American law, and these obligations take precedence over the relief afforded by filing for bankruptcy. The recent Bankruptcy Abuse Prevention and Consumer Protection Act (BAPCPA) helps clarify the rules surrounding such payments, and re-emphasizes the importance of providing for and caring for one’s children.

Chapter 7 bankruptcy is a type of liquidation bankruptcy, in which non-exempt property is sold. The sale of these items is used to pay off one’s creditors. For example, if you owe $10,000 to the bank and can’t pay it, you can file for Chapter 7 bankruptcy, and the money made from the sale of your possessions is used to pay off that debt. Under the BAPCPA, the continued support of any children is considered a serious priority, and proceeds from the sale go towards your court-ordered payment plan first, before creditors are able to take the money. (more…)

Filing for bankruptcy ruins your credit for 10 years.

Not True. As with any other credit information, the fact of the bankruptcy can stay on your credit report for 7 to 10 years. (Remember, if you are considering bankruptcy it is highly likely that your credit rating has already been damaged, especially for the purpose of obtaining a home loan.) You can start rebuilding your credit, however, even before your bankruptcy is completed. Continuing to make your house or car payment on time can help you reestablish a good credit rating, as can making timely payments on a Chapter 13 plan or on any new loans.

Everyone will know you filed for bankruptcy.

Not True. The fact of your bankruptcy is a public record but unless you are a prominent official or high profile person, people aren’t going to go looking.

After the recent changes to the bankruptcy law, filing bankruptcy doesn’t help much.

Not True. The 2005 changes mean that a few people may no longer be able to file a Chapter 7 case, but most people are still able to get the same relief now as before the law changed. If a Chapter 7 is not available to you because of the 2005 changes, Chapter 13 may still offer you significant relief.

You are a bad person for filing bankruptcy.

Not True. Bankruptcy is a solution to help good people go through a tough financial time. It provides people with the fresh start that they deserve. Congress passed the bankruptcy laws because Congress recognized that we needed a safety net in our economic system for individuals, who have little control over large shifts in our economy or over unexpected personal developments such as job losses and medical expenses. The events of late 2008 should be making it clear to all of us that our financial health is not usually a function of whether we are good or bad persons.

You can pick and choose what to put into bankruptcy. (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…)

Bankruptcy and You – Understanding Credit Cards and Credit

Bankruptcy reform has made it more difficult than ever for people to file bankruptcy and enjoy being able to just get rid of credit card debt when they cannot afford it. However, this increase in difficulty when it comes to debt relief has led to credit card companies that are more aggressive than ever before. There is a great debate among the ABA, or American Bankers Association, about who is to blame for credit card debt and so many bankruptcy cases being filed. The lenders blame the consumers, while some blame the creditors for being too aggressive.

There will never be a definitive answer as to who is at fault. However, in order to make sure that consumers are safe no matter what creditors are doing, it is important to be informed. It IS harder than ever to file bankruptcy if a financial debacle is created. It isn’t hard to find debt relief services or companies that can help with debt settlement. It is the responsibility of the consumer, no matter how persuasive creditors might be, to avoid becoming another statistic of credit card debt and let debt take over their lives. (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…)

While bankruptcy is very much a viable and legitimate means of resolving desperate financial situations, people have some very grave and real concerns about a number of potential consequences. A commonly asked question by those considering bankruptcy as a route to solving their problems is, “Will bankruptcy affect my job?” And if so, “HOW will bankruptcy affect my job?”

Well, technically, federal law prohibits any discrimination on the part of your lawyer against you because you have declared or are planning to declare bankruptcy. So, you should not feel concerned about the potential problems with an existing employer. There should be no ill will, negative responses, being overlooked for promotions and certainly not fired over your personal financial situation in regard to bankruptcy. If you receive this type of treatment, your employer is in breach of the law and you could take legal action against him or her. (more…)

If you have debt and you are looking for a way out, consolidating your credit card debt should be your first step. Having your debt all in one place makes it easier for you to see what you owe and to monitor your progress. There are a few ways you can do this, but not all of these methods are desirable.

Debt consolidation loans are one method of consolidating your debts. However, it is not something I would recommend. Most of these loans are secured with your home. This means home ownership and good credit are necessary. And that is assuming you can find a lender willing to finance a home equity line of credit right now. The big disadvantage is what can happen if you cannot make your payments. You could be faced with foreclosure. (more…)

Nobody likes to file Chapter 7 bankruptcy. However, when the pressure of debt seems insurmountable, the option of Chapter 7 may seem to be the only way to achieve debt relief. What a lot of people who settle on Chapter 7 fail to realize is that it stirs a whole bunch of other emotions and pressures.

Depression

Without question, depression is probably the most-often cited after side effect of filing for Chapter 7 bankruptcy. People who have financial trouble will lose sleep, become physically ill (the most “popular” physical effects include ulcers, heart conditions, hypertension), and notice a definite strain in their relationships.

Knowing ahead of time that depression is a side effect of Chapter 7 bankruptcy allows filers to prepare for what can be a very bumpy emotional road to their “fresh start.” By understanding just how bad the depression can get, filers can join support groups or seek advance-advice from their doctor or counselor. (more…)

If you have reached a point where your finances are spiraling out of control and you can simply not afford to repay debts you owe within three years and even with significant cut backs and changes to your spending, then you are most likely in a situation where you are considering the possibility of declaring bankruptcy. And if that does apply to you, then you are probably wondering just what are the effects of declaring personal bankruptcy? What will the consequences be?

Well, first of all, take comfort from the fact that you are not alone in considering bankruptcy. And also, bear in mind that it is a legitimate means of getting a fresh financial start for those with no other alternative. But the effect on your credit rating will be negative. Bankruptcy is considered the ultimate admission, in many ways, of an inability to manage one’s finances. It shows up on your credit file for ten years. During this time you will find it terribly difficult to obtain credit and even in situations where you are able to get credit, you will face extremely high interest rates are you will be deemed a high risk borrower. You can, however, with patience, sensible spending and discipline, rebuild your credit. (more…)