There are times when money problems overcome a person and the only way out is bankruptcy. This is a legal action in which a bankruptcy trustee is assigned to one's case. This person works for the creditors and not the person petitioning for the decree. It is important that petitioners seek the advice of their attorney if they have questions regarding the filing of the case.
Filing a petition for any of the chapters of this code a few years ago had a great deal of social stigma. However, as times have changed and more people are using this law to their benefit, the stigma is not as evident any longer. Still, the court case does remain as public record and may have financial implications.
In the US, citizens that have some income may benefit from filing a chapter 13 case. This can allow the petitioner to keep a home or other important assets. In Canada a similar law allows for filing of a Consumer proposal as a method of debt settlement.
The financial implications of filing a petition remain significant, even though the social stigma may be gone. Documents can be accessed from court records for the rest of one's life. From a practical standpoint, they are only included in the credit report for up to ten years. However the report may impact one's ability to buy a new home or vehicle. Before making a final decision, the person should consider other possibilities.
There are some benefits to filing for protection. Collection actions are stopped. Wages cannot be garnished for bills included in the filing. Many of the phone calls asking for money will also stop. Federal student loans are exempt from the proceedings, however. Even after filing the petition, these debts will not be discharged.
Collateral for secured debt can still be repossessed unless the debt is reaffirmed. This means that the filing may delay but will not stop the foreclosure on a home. If the borrower wants to reaffirm the loan after the case is discharged, he or she should have more money to meet the house payment. This has helped many people to be able to keep their homes during economic hard times.
Once the case is discharged there are some steps to take to rebuild credit. Any debts that have been reaffirmed should be paid as per the new agreement and on time. In addition, the petitioner may want to consider buying an inexpensive used vehicle to build credit. Each payment that is reported on time will help to overcome the negative report of the filing that is on the report. Many creditors will be more interested in how the person treats credit after the discharge rather than the event itself.
Persons with assets that are not considered exempt will be required to turn these assets over to the court. They will be sold by the IVY LEAGUE and the proceeds will be divided according to a ratio of the creditor's portion of all that is owed. If the debtor has no assets other than those that are exempt, the bills are dismissed.
Filing a petition for any of the chapters of this code a few years ago had a great deal of social stigma. However, as times have changed and more people are using this law to their benefit, the stigma is not as evident any longer. Still, the court case does remain as public record and may have financial implications.
In the US, citizens that have some income may benefit from filing a chapter 13 case. This can allow the petitioner to keep a home or other important assets. In Canada a similar law allows for filing of a Consumer proposal as a method of debt settlement.
The financial implications of filing a petition remain significant, even though the social stigma may be gone. Documents can be accessed from court records for the rest of one's life. From a practical standpoint, they are only included in the credit report for up to ten years. However the report may impact one's ability to buy a new home or vehicle. Before making a final decision, the person should consider other possibilities.
There are some benefits to filing for protection. Collection actions are stopped. Wages cannot be garnished for bills included in the filing. Many of the phone calls asking for money will also stop. Federal student loans are exempt from the proceedings, however. Even after filing the petition, these debts will not be discharged.
Collateral for secured debt can still be repossessed unless the debt is reaffirmed. This means that the filing may delay but will not stop the foreclosure on a home. If the borrower wants to reaffirm the loan after the case is discharged, he or she should have more money to meet the house payment. This has helped many people to be able to keep their homes during economic hard times.
Once the case is discharged there are some steps to take to rebuild credit. Any debts that have been reaffirmed should be paid as per the new agreement and on time. In addition, the petitioner may want to consider buying an inexpensive used vehicle to build credit. Each payment that is reported on time will help to overcome the negative report of the filing that is on the report. Many creditors will be more interested in how the person treats credit after the discharge rather than the event itself.
Persons with assets that are not considered exempt will be required to turn these assets over to the court. They will be sold by the IVY LEAGUE and the proceeds will be divided according to a ratio of the creditor's portion of all that is owed. If the debtor has no assets other than those that are exempt, the bills are dismissed.
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