When a business or individual consumer accumulates a lot of bad debt, the only option they may have for getting rid of the debt may be to file for bankruptcy. This is a legal option with serious consequences, so debtors should only use it as an option of last resort. Debt refinancing and consolidation should be considered before bankruptcy CA can be considered.
Businesses can seek to become bankrupt under two chapters. These are chapters 7 and 11. The former provides for debt forgiveness through liquidation of assets belonging to the business debtor while the latter provides for debt forgiveness through debt reorganization. This means that the business will have to make regular monthly debt payments for several years to get debt forgiveness.
Individual debtors can use either the chapter 7 or chapter 13 to become bankrupt. During chapter 7 proceedings, the assets of the debtor are usually sold to recover money to settle their debts. In a chapter 13, the debtor retains all their assets, but has to make regular monthly payments for several years. The payments are usually convenient and affordable to the debtor.
There are several negative effects of becoming bankrupt. For one, your credit report will show that you are bankrupt, so nobody will be willing to lend you money. Secondly, the reputation of your business will be adversely affected, and this may force you to close shop. In case of personal bankruptcy, your friends, colleagues, neighbors and relatives will start looking at you differently.
Becoming bankrupt can lead to job loss if you have a job that can only be handled by financially responsible persons. When you become bankrupt, therefore, you may be fired because you no longer meet the minimum requirements for holding that office. To make matters worse, finding a similar or better job will also be challenging.
It is always recommended you consult a suitable lawyer before deciding to become bankrupt. This is because you may not be fully aware of the legal consequences of becoming bankrupt. By consulting a lawyer, you will be able to make an informed decision. To find the right lawyer, simply search the web and compare their experiences and reputation before making a decision.
Student loan debts, alimony and child support payments cannot be written off when you become bankrupt. If these debts form a huge chunk of your outstanding debts, therefore, you should rethink your decision to become bankrupt. After all, this option will only complicate matters for you. Since you may not know what this law entails, you must hire a competent lawyer to explain the contents of the Federal Bankruptcy Act to you.
After submitting the necessary paperwork, the court will appoint a trustee to oversee the whole process. The trustee is usually an independent, unbiased, legal and business expert who will put the finances of the applicant under a microscope to determine whether or not they qualify for the chapter they are requesting.
Businesses can seek to become bankrupt under two chapters. These are chapters 7 and 11. The former provides for debt forgiveness through liquidation of assets belonging to the business debtor while the latter provides for debt forgiveness through debt reorganization. This means that the business will have to make regular monthly debt payments for several years to get debt forgiveness.
Individual debtors can use either the chapter 7 or chapter 13 to become bankrupt. During chapter 7 proceedings, the assets of the debtor are usually sold to recover money to settle their debts. In a chapter 13, the debtor retains all their assets, but has to make regular monthly payments for several years. The payments are usually convenient and affordable to the debtor.
There are several negative effects of becoming bankrupt. For one, your credit report will show that you are bankrupt, so nobody will be willing to lend you money. Secondly, the reputation of your business will be adversely affected, and this may force you to close shop. In case of personal bankruptcy, your friends, colleagues, neighbors and relatives will start looking at you differently.
Becoming bankrupt can lead to job loss if you have a job that can only be handled by financially responsible persons. When you become bankrupt, therefore, you may be fired because you no longer meet the minimum requirements for holding that office. To make matters worse, finding a similar or better job will also be challenging.
It is always recommended you consult a suitable lawyer before deciding to become bankrupt. This is because you may not be fully aware of the legal consequences of becoming bankrupt. By consulting a lawyer, you will be able to make an informed decision. To find the right lawyer, simply search the web and compare their experiences and reputation before making a decision.
Student loan debts, alimony and child support payments cannot be written off when you become bankrupt. If these debts form a huge chunk of your outstanding debts, therefore, you should rethink your decision to become bankrupt. After all, this option will only complicate matters for you. Since you may not know what this law entails, you must hire a competent lawyer to explain the contents of the Federal Bankruptcy Act to you.
After submitting the necessary paperwork, the court will appoint a trustee to oversee the whole process. The trustee is usually an independent, unbiased, legal and business expert who will put the finances of the applicant under a microscope to determine whether or not they qualify for the chapter they are requesting.
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