Having financial problems is not a special thing nowadays. Unfortunately more and more are having problems with their finance. Reasons can be different, remaining without a job, not having the chance to earn the necessary amount of money to live a proper, well deserved lifestyle. In many cases bankruptcy is the final solution, but can give people the second financial chance. Being bankrupt might be uncomfortable, but people can find the solution to consolidate and clear their debt and have credit.
We can spend our money so easily and we sonly realize our debt grows daily and we fall behind with our payments. That is why we are searching for those solutions that can help us delete and remove our debts. There are six types of bankruptcy, but in the majority of the cases people file for two of them: Chapter 7 or Chapter 13.
Chapter 7 Bankruptcy is chosen by people to get out of debt, erase their payment and get going on. It was designed to eliminate a debtor’s unsecure debts. It helps in discharging payday loans, credit card debts, medical bills, and once erased, the filer does not have to pay for them; to repay. When a person files Chapter 7, he is given the protection of the automatic stay bankruptcy, this way loaners are prohibited from making any further collection efforts. The bankruptcy automatic stay is a legal order, which can stop repossession or foreclosure.
Chapter 7 Bankruptcy unlike Chapter 13 is used by people who have little or no property. Chapter 13 Bankruptcy is filed by people who need to protect the property they have, it was designed to stop foreclosure. The rise in foreclosures is widespread and can be the result of the high costs of living or banks giving out bad loans. In order to qualify for Chapter 13 you do not need to fill a test like when acquiring Chapter 7, mostly because you should have a regular income and it involves a repayment plan. The debtor is automatically given the protection of automatic stay when filling out a bankruptcy petition with the court. This way, creditors are being stopped from further contacting or collecting and repossessing efforts. A repayment plan includes the debtor giving directly to the bankruptcy court a lower monthly payment, which procedure lasts from 3 to 5 years. At the end of the repayment the remaining unsecured debts and the debtor can remain with his own property.
As you can see there are options that can help you in debt consolidation, you just have to choose the one most suitable for you. |
