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Bankruptcy Pros and Cons

Bankruptcy Pros and Cons
"""The decision to apply for bankruptcy is a challenging one. People want to be able to pay their creditors in accordance with their original agreements. Occasionally, unavoidable circumstances render this task unfeasible. When this occurs, individuals petition for Chapter 7 bankruptcy.

As with anything, declaring bankruptcy has both advantages and disadvantages. Before discussing these pros and cons in depth, it is necessary to understand how bankruptcy works.

You can file for bankruptcy by submitting to the bankruptcy court the necessary documents demonstrating that you cannot pay your creditors the amount you owe them under the original terms. When you file for Chapter 7 bankruptcy, the amounts you owe to each creditor at the time of filing are halted from increasing. Creditors are prohibited from adding any additional late fees or penalties to your account.

When you file for bankruptcy, your creditors are required by law to stop contacting you and to cease all collection efforts, including wage garnishment and vehicle repossession. This includes wage garnishments that have already been deducted from your take-home pay. This includes IRS wage garnishments.

You and your creditors will each have an opportunity to address the court regarding the amount of money you owe. Your attorney is present at this proceeding. The majority of creditors do not attend.

After registering for Chapter 7 bankruptcy, all dischargeable debts will be discharged. No longer do you owe these creditors any money. Permitting you to sleep soundly at night.

How long a bankruptcy lasts is one of the most frequently asked queries concerning bankruptcy. A bankruptcy can remain on your credit report for as long as ten years. You are given a fresh start and a second opportunity to establish a positive credit history.

There are numerous bankruptcy pros and cons to consider when determining your course of action.

It takes only three to six months to complete the Chapter 7 filing procedure. During this period, creditors are prohibited from contacting you or communicating with you about your debt. There is an end to all garnishments and repossessions. You are released from the majority of your debts. It may be simpler to explain bankruptcy to future creditors than to explain the accumulation of late fees, defaults, repossessions, and litigation.

A Chapter 7 bankruptcy may stay on your credit report for up to ten years. You will be required to surrender your credit cards. You may be required to surrender some of your luxury items to the bankruptcy trustee for sale. If you have withdrawn more than $750.00 from your credit card in the seventy days prior to filing for Chapter 7 bankruptcy, this amount may not be included in your bankruptcy estate.

Chapter 7 bankruptcy can get you back on the path to excellent credit more quickly than repossessions and defaults. You will not be required to surrender or turn over to the bankruptcy trustee all of your personal property and assets for liquidation. Numerous assets will be exempt from the bankruptcy estate. You will have more money available to spend on immediate necessities. You will be able to reestablish your credit history. If you do not qualify for Chapter 7 bankruptcy, you will likely qualify for Chapter 13 bankruptcy.

Online bankruptcy filing is available at your convenience. By filing online from the comfort of your own home, you have access to your bankruptcy attorney 24 hours a day. You will receive the same level of legal representation in court as you would in an attorney's office. The online attorney will manage the completion of all required paperwork and the filing of the correct number of copies with the court.

Some debts cannot be eliminated by filing for bankruptcy. Student loans and alimony/child support obligations are not dischargeable under Chapter 7 bankruptcy. You will be required to explain the origins of your financial difficulties to a bankruptcy trustee or judge. You are only permitted to petition for Chapter 7 once every six years. You may still have some debt after the conclusion of the proceedings.""

" - https://www.affordablecebu.com/
 

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"Bankruptcy Pros and Cons" was written by Mary under the Finance / Wealth category. It has been read 112 times and generated 0 comments. The article was created on and updated on 01 June 2023.
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