What Type of Bankruptcy Should You File For?
Everyone in the business world, of course, will have an advantage. Whether it’s working for a company, or starting your own business. All the benefits will be based on the results of each one’s hard work. just like the action of modifying the car it certainly provides business opportunities for many people. But like life, doing business sometimes has its ups and downs and leaves you in debt, and leads to bankruptcy.
Bankruptcy is a legal process undertaken to allow individuals or businesses to be free of their debts, while at the same time giving creditors the opportunity to repay.
A more common route is to file bankruptcy on a voluntary basis. The second way, creditors ask the court to order bankruptcy.
Declaring Bankruptcy: Scary, but Sometimes Necessary
If you have a tense debt burden, maybe it’s time to face financial facts. Maybe you’ve been trying to ignore the ringing of your phone and the pile of unpaid bills that just don’t go away.
You may want to consult with a bankruptcy in oklahoma attorney before proceeding so that you can find the best fit for your situation.
What Is Bankruptcy?
Bankruptcy is a legal process that involves a person or business that is unable to pay back debts. The bankruptcy process begins with an application filed by the debtor, the most common, or on behalf of the creditor, which is less common. All debtor assets are measured and evaluated, and these assets can be used to pay back a portion of the outstanding debt.
In fact, it is easy to argue that there is no single “average” or typical bankruptcy filing.
Even so, statistics show that circumstances beyond age, income, or education level – play a large role in whether or not to file a decision.
In theory, the ability to file bankruptcy benefits the economy as a whole by allowing people and companies a second chance to gain access to credit and by making partial debt payments to creditors. After successfully completing the bankruptcy process, the debtor is exempted from the debt obligations that were incurred prior to filing for bankruptcy.
How Do I Declare Bankruptcy?
Individuals – and in some cases businesses, with little or no assets – typically file Chapter 7 bankruptcy. This allows them to dispose of their unsecured debt, such as credit card balances and medical bills. Those without assets, such as family heirlooms, collections of high value, such as coins or stamp collections; second house; and cash, shares, or bonds must liquidate the property to pay back some or all of its unsecured debt.
A person filing for Chapter 7 bankruptcy is basically selling their assets to pay off the debt. People who have no valuable assets and only exempt property – such as household goods, clothing, trading equipment, and personal vehicles valued up to a certain value – may end up not paying back some of their unsecured debt.
Individuals who make too much money to qualify for Chapter 7 bankruptcy can file under Chapter 13, also known as a breadwinner plan. This allows individuals – as well as businesses, with consistent incomes – to create workable debt repayment plans. The repayment plan is usually paid in installments over a period of three to five years. In exchange for paying back his creditors, the court allows this debtor to keep all his property, including any property that is not exempted.
For people who own property, they wish to keep, filing for Chapter 13 bankruptcy may be a better option.