However, this method of resolving a bad financial situation should be utilized with prudence, as the cost of declaring bankruptcy may be significantly higher than you anticipate.
Here are some suggestions for comprehending the true expense of bankruptcy.
Chapter 7 bankruptcy is designed for individuals and couples seeking a new beginning. It is the most difficult to qualify for, but also the quickest method of debt discharge.
The filing of a Chapter 7 petition requires a means assessment. This test is used by the court to determine whether the debtor is capable of repaying the debt within the allotted time frame using one of the alternative chapters.
If the means test is failed, a bankruptcy petition is filed. The duration of the entire procedure is three to four months. However, continued possession of your residence and vehicle may not be granted, as these items may be liquidated.
This type of bankruptcy is only appropriate for businesses. It is one of the most difficult and expensive forms of bankruptcy to register.
The court will require two distinct categories of documentation from the petitioner.
First, they must devise a plan for the timely repayment of their debts to their creditors. Second, they will need to demonstrate that the necessary resources will be available. Creditors have the option to reject the proposal.
This is the most prevalent type of bankruptcy for individuals. Typically, it is the quickest as well. Also, unlike Chapter 7, assets are not forcibly lost through liquidation.
Along with the petition, the individual will include a payment schedule for the next three to five years. In general, remittances of 10 cents per dollar owed are acceptable. In some cases, it can be as high as 50 cents per dollar owed.""
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