Important Rules Of Bankruptcy [mortgage-answer.blogspot.com]
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Bankruptcy is a legal proceeding in which you put your money in your pocket and give your coat to your creditors.
-. Joey Adams (1911-1999), American comedian, actor and author
Bankruptcy is one of the most difficult that we can never deal in his life. Inability to repay those debts is a heavy cross to bear, and many suffer the moral consequences of filing for bankruptcy. after all, in many ways, it gives a second chance to stand on his feet again.
If you have been assaulted by the ongoing recession and decided to file for bankruptcy, you must be aware of the following five important rules of bankruptcy:
1. Know the difference between Chapter 7 and Chapter 13 bankruptcy
Chapters 7 and 13 of the Bankruptcy Code in the United States are the most common forms of personal bankruptcy filings. However, there is much difference between them.
While the former is a process of liquidation, a ll debts are discharged, it is a debt restructuring plan with a specified redemption. In addition, under Chapter 7, that certain property can be preserved while the rest is liquidated, but under Chapter 13, most goods can be stored for as long as regular payments are made. In addition, a Chapter 7 bankruptcy stays longer in the credit report (10 years) compared to an application filed under Chapter 13 (7 years).
In 2005, the prevention of abuse of the Bankruptcy Act and the Consumer Protection (BAPCPA) was enacted to make Chapter 7 filings more difficult to reduce abuse of the provision. Now the debtor's income is calculated and then compared the resulting figure is the median of the State where he resides. Only if the debtor's household income falls below the median income for the state to qualify for the debtor to file for Chapter 7 bankruptcy.
2. Knowing where to file for bankruptcy
Now that you know the difference between Chapter 7 and Chapter 13 bankruptcy, you can decide which chapter to file under. If you are heavily in debt with virtually no assets, strictly speaking, Chapter 7 seems to be the best option, provided you qualify under the new restrictions. On the other hand, if you have temporarily fallen behind on payments due to an accidental event, such as loss of job or medical expenses, you should opt for Chapter 13.
3. How to file bankruptcy />
4. The consequences of filing bankruptcy for
Know that the record of bankruptcy will remain on your credit history 7 to 10 years, it is extremely diff icult for you to get any type loans. Even if you get one, the interest rate will be very high.
5. Know what to do after filing bankruptcy
After filing for bankruptcy, to live within your means, do not incur additional debt, and make regular payments orders of the Bankruptcy Court . More Important Rules Of Bankruptcy Issues
