Bankruptcy attorneys estimate that one in every 53 U.S. households filed for bankruptcy in 2005. Most of these people didn't lose the farm in Vegas or drink away their life savings. Chances are their financial problems stemmed from one of three sources: job loss, divorce, or unexpected and expensive medical emergencies.
Most homeowners who file for bankruptcy do not lose their homes. Bankruptcy laws are designed to satisfy creditors and protect debtors. Putting a family out on the street helps no one.
Ted Janger of The American Bankruptcy Institute stresses that, “It is important to have competent counsel advise you, both about the choices among chapters and about how best to make sure that bankruptcy operates to solve your financial difficulties, rather than just as a hiatus.”
Establishing Credit After Bankruptcy
For people who got into trouble with credit, the thought of using it again can be frightening. It’s a catch-22. To be considered a good candidate for a new mortgage or car loan, consumers have to rebuild their credit. If they don’t, when a prospective lender looks at their credit report, all they will see is the bankruptcy. There won’t be a new track record of handling credit responsibly or of improved financial management skills.
It doesn’t seem logical, but after people have successfully filed for bankruptcy, they will receive a flood of new credit offers. If they accept a few well chosen ones and pay more than the minimum payment each month, this will appear as positive data in their credit report.
One form of new credit would be a first mortgage refinance or a new second mortgage. Either transaction would depend on the amount of equity in the home and be subject to any guidelines established by the bankruptcy court.
Mike Hamel is the author of three business books and several articles about mortgage financing. His material is featured on sites like E-lends. To learn more about a Bankruptcy Mortgage, or to receive a complimentary quote, visit E-lends. Even after bankruptcy, you should still be able to get a competitive mortgage.
http://ezinearticles.com/?Bankruptcy-Mortgage-Information-For-Homeowners&id=660435
Monday, July 30, 2007
Now Is The Time For Understanding Bankruptcy In Business
Individual and business bankruptcy is entirely different from each other. Businesses use bankruptcy to reorganize their company to avoid bankruptcy. This allows time to turn a profit and retain ownership of all assets. Many businesses can file under chapters 13, 7, 12 and 11 depending on their circumstance.
Limitations apply to businesses that use chapters 12 and 13. Chapter 12 is dedicated to farmers and anglers who operate family businesses. Chapter 13 pertains to proprietary business owners of a small business. Because of these limitations, most businesses file under chapters 7 or 11.
If you feel your business is failing, bankruptcy may be the answer and chapter 7 will allow you to liquidate your assets to settle debts with creditors. A court appointed trustee will help you through the process of liquidation and keeps the money to distribute to creditors after all sales are completed. Creditors are paid back according to federal bank codes.
Understanding bankruptcy in business leads us to look further at chapter 7. Creditors like chapter 7 bankruptcies because they receive as much of their money as possible through the liquidation process along with the legal liability of their claim. The company itself is responsible for taxes in most cases. The chapter 7 expenses and taxes are paid before creditors. This prevents you from incurring any more debt than you already have.
If you feel, your business can be saved but need some time to reorganize and turn a profit, chapter 11 will benefit you by allowing the business to run as usual while trying to become profitable. Any big decisions about the business must have approval from the courts. Such businesses like K-Mart and Enron used chapter 11 bankruptcies in order to reorganize and turn a profit. Many companies’s use this course of action and succeed, but some do not make it and lose their business and assets.
Creditors are stopped cold in their tracks from taking any further action against you once you file the bankruptcy papers and this helps a company turn a profit and pay creditors before collection actions further hamper the business. Understanding bankruptcy in business in not much different from a personal bankruptcy, but there are a few things that appear different. If a company needs some time to earn a few dollars, they can just file a chapter 11 and reorganize before losing the company. We really do not have that complete option as personal bankruptcy candidates.
You can also find more info on Filing Personal Bankruptcy and Avoid Bankruptcy. Filingpersonalbankruptcyhelp.com is a comprehensive resource to get help in Bankruptcy.
http://ezinearticles.com/?Now-Is-The-Time-For-Understanding-Bankruptcy-In-Business&id=661498
Limitations apply to businesses that use chapters 12 and 13. Chapter 12 is dedicated to farmers and anglers who operate family businesses. Chapter 13 pertains to proprietary business owners of a small business. Because of these limitations, most businesses file under chapters 7 or 11.
If you feel your business is failing, bankruptcy may be the answer and chapter 7 will allow you to liquidate your assets to settle debts with creditors. A court appointed trustee will help you through the process of liquidation and keeps the money to distribute to creditors after all sales are completed. Creditors are paid back according to federal bank codes.
Understanding bankruptcy in business leads us to look further at chapter 7. Creditors like chapter 7 bankruptcies because they receive as much of their money as possible through the liquidation process along with the legal liability of their claim. The company itself is responsible for taxes in most cases. The chapter 7 expenses and taxes are paid before creditors. This prevents you from incurring any more debt than you already have.
If you feel, your business can be saved but need some time to reorganize and turn a profit, chapter 11 will benefit you by allowing the business to run as usual while trying to become profitable. Any big decisions about the business must have approval from the courts. Such businesses like K-Mart and Enron used chapter 11 bankruptcies in order to reorganize and turn a profit. Many companies’s use this course of action and succeed, but some do not make it and lose their business and assets.
Creditors are stopped cold in their tracks from taking any further action against you once you file the bankruptcy papers and this helps a company turn a profit and pay creditors before collection actions further hamper the business. Understanding bankruptcy in business in not much different from a personal bankruptcy, but there are a few things that appear different. If a company needs some time to earn a few dollars, they can just file a chapter 11 and reorganize before losing the company. We really do not have that complete option as personal bankruptcy candidates.
You can also find more info on Filing Personal Bankruptcy and Avoid Bankruptcy. Filingpersonalbankruptcyhelp.com is a comprehensive resource to get help in Bankruptcy.
http://ezinearticles.com/?Now-Is-The-Time-For-Understanding-Bankruptcy-In-Business&id=661498
Tuesday, July 24, 2007
Offshore Options For Bankrupts And Those With Poor Credit
If you've had more than your fair share of financial knocks and scrapes in life and you've been made bankrupt or you simply have a poor credit history you'll know that being in such a financial position is not only emotionally very difficult and stressful, it can also lead to you living in a catch 22 situation where you can’t even establish a new business or get a new business bank account to enable you to trade and rebuild your professional reputation and financial standing.
There are however excellent legitimate offshore options for bankrupts and those with poor credit history because although you’re bankrupt in one country, that financial label and unfairly associated stigma does not travel outside the borders of the country in which you have been declared.
So, if you’re in a position where you want to start a new business or resume contracts where you left off, where you want to open a bank account to receive cheques and payments for work undertaken and completed and everywhere you currently turn you’re faced with closed doors and ‘I’m sorry, we can’t help you’ type rejections, it’s time to turn your own back on so called helpful banks and institutions who only ever help those who can already help themselves and look at the offshore world.
First things first you need to know that it is 100% legal for you to go offshore. Secondly here’s an example scenario of when you could go offshore and how you could go offshore: -
Example Scenario
You have been declared bankrupt because clients bounced cheques on you and failed to pay you for work you had undertaken.
You now have a new client base and have orders open for which you will be paid in part up front thus giving you the capital you need to get started.
You can no longer be a director of a new company in your home country.
Without a company you cannot open a business bank account.
You cannot risk using your personal account for these transactions.
Example Solution
You could immediately establish an off-the-shelf company offshore and open an offshore business bank account in the name of the company.
You can use the company to trade through and raise invoices from, you can use the bank account to send and receive payments.
Hey presto you’re back up and running!
Just remember that you need to choose a reputable offshore tax haven that your clients won’t be suspicious of or have black listed in their minds as a location used by ‘dodgy’ business persons!
Additionally if you use an offshore company incorporation service provider you should be issued with a 100% money back guarantee that if they cannot open you an offshore business bank account in the name of your company they refund all monies paid up front to them - because opening an account can be tricky for some service providers and you do not want to be left in the position where you have a company to trade through but no account to receive payments into.
And finally, remember also that by going offshore you cannot evade taxation. Where a reporting requirement exists in your own home country you are legally obliged to abide by that reporting requirement.
Rhiannon Williamson writes about offshore company formation and incorporation - how to do it and who can benefit from it - and understanding the features and benefits of offshore bank accounts, offshore trusts and investments. Her website ShelterOffshore.com has all the offshore information you could possibly need.
http://ezinearticles.com/?Offshore-Options-For-Bankrupts-And-Those-With-Poor-Credit&id=654580
There are however excellent legitimate offshore options for bankrupts and those with poor credit history because although you’re bankrupt in one country, that financial label and unfairly associated stigma does not travel outside the borders of the country in which you have been declared.
So, if you’re in a position where you want to start a new business or resume contracts where you left off, where you want to open a bank account to receive cheques and payments for work undertaken and completed and everywhere you currently turn you’re faced with closed doors and ‘I’m sorry, we can’t help you’ type rejections, it’s time to turn your own back on so called helpful banks and institutions who only ever help those who can already help themselves and look at the offshore world.
First things first you need to know that it is 100% legal for you to go offshore. Secondly here’s an example scenario of when you could go offshore and how you could go offshore: -
Example Scenario
You have been declared bankrupt because clients bounced cheques on you and failed to pay you for work you had undertaken.
You now have a new client base and have orders open for which you will be paid in part up front thus giving you the capital you need to get started.
You can no longer be a director of a new company in your home country.
Without a company you cannot open a business bank account.
You cannot risk using your personal account for these transactions.
Example Solution
You could immediately establish an off-the-shelf company offshore and open an offshore business bank account in the name of the company.
You can use the company to trade through and raise invoices from, you can use the bank account to send and receive payments.
Hey presto you’re back up and running!
Just remember that you need to choose a reputable offshore tax haven that your clients won’t be suspicious of or have black listed in their minds as a location used by ‘dodgy’ business persons!
Additionally if you use an offshore company incorporation service provider you should be issued with a 100% money back guarantee that if they cannot open you an offshore business bank account in the name of your company they refund all monies paid up front to them - because opening an account can be tricky for some service providers and you do not want to be left in the position where you have a company to trade through but no account to receive payments into.
And finally, remember also that by going offshore you cannot evade taxation. Where a reporting requirement exists in your own home country you are legally obliged to abide by that reporting requirement.
Rhiannon Williamson writes about offshore company formation and incorporation - how to do it and who can benefit from it - and understanding the features and benefits of offshore bank accounts, offshore trusts and investments. Her website ShelterOffshore.com has all the offshore information you could possibly need.
http://ezinearticles.com/?Offshore-Options-For-Bankrupts-And-Those-With-Poor-Credit&id=654580
Monday, July 23, 2007
Things To Consider When You Are Filing Bankruptcy
Due to the steadily rising costs of living and other increasing expenses, some people are filing bankruptcy. Before taking the serious step of filing bankruptcy, it is reasonable to look into some information to decide what kind of bankruptcy may be right for you.
There are two different ways to file bankruptcy.
The Chapter 7 bankruptcy, for example, will eliminate all your debts. In exchange, you may lose any property or other assets that you may own. So if you do not have any assets to lose, then chapter 7 may be right for you. It will give you a fresh start.
If you have a steady income and assets, you might be further ahead to look into filing bankruptcy with Chapter 13. You may have to pay all your debts back, but you will have worked out an arrangement with the court so that you can do so in smaller installments, which will leave you more money after making the payments. When filing Chapter 13, you are able to keep assets that you may own.
Many people have heard about the new bankruptcy laws and in some cases, a person may have to file Chapter 13 instead of Chapter 7 under the new laws. But all in all, the laws remain about the same when it comes to filing bankruptcy. However, there are subtle differences in the law from state to state, and if you are going to be filing bankruptcy, there are not too many ways to do it in a state other than the one in which you are listed as a resident.
From the day you are filing bankruptcy and have a signed statement, there should be no more harassing phone calls or wage garnishing. If anything like that continues to occur, you can have your bankruptcy lawyer handle that to have it stopped.
Filing bankruptcy will be recorded in your credit report for 10 years. This can be a big disadvantage down the road. You may have a problem for some time if you want to buy a home and get a mortgage loan. If you want to start a business after filing bankruptcy, it may prevent you from getting needed credit to grow your business.
These and other factors need to be considered when filing bankruptcy.
There may be other options. Some people have tried to get help from a credit counselor. You need to be cautious when looking into this option, because if you choose the wrong organization, you could end up paying out even more money.
What about a debt consolidation loan? That may be another alternative for you. When taking out a debt consolidation loan, you can manage your finances more easily and you may be able to pay your debts without filing bankruptcy.
Either of these options may work out better for you than actually filing bankruptcy. That is not something you want to do unless it is really necessary and you have no other viable options.
Depending on the situation you are in, there could be different options for you to look at. Filing Chapter 7 bankruptcy should be your last resort. If possible, you do want to pay back what you owe and learn to be more careful when it comes to spending money.
According to some statistics, quite a few people have had a large amount of medical expenses and are not able to pay these back. In a given situation like this, your best option may be to discuss it with a bankruptcy lawyer who is familiar with the laws in your state and get their advice on what you should do.
For more insights and additional information about Filing Bankruptcy and a free consultation with a bankruptcy lawyer local to you, please visit our web site at http://www.bankruptcy-data.com
http://ezinearticles.com/?Things-To-Consider-When-You-Are-Filing-Bankruptcy&id=651332
There are two different ways to file bankruptcy.
The Chapter 7 bankruptcy, for example, will eliminate all your debts. In exchange, you may lose any property or other assets that you may own. So if you do not have any assets to lose, then chapter 7 may be right for you. It will give you a fresh start.
If you have a steady income and assets, you might be further ahead to look into filing bankruptcy with Chapter 13. You may have to pay all your debts back, but you will have worked out an arrangement with the court so that you can do so in smaller installments, which will leave you more money after making the payments. When filing Chapter 13, you are able to keep assets that you may own.
Many people have heard about the new bankruptcy laws and in some cases, a person may have to file Chapter 13 instead of Chapter 7 under the new laws. But all in all, the laws remain about the same when it comes to filing bankruptcy. However, there are subtle differences in the law from state to state, and if you are going to be filing bankruptcy, there are not too many ways to do it in a state other than the one in which you are listed as a resident.
From the day you are filing bankruptcy and have a signed statement, there should be no more harassing phone calls or wage garnishing. If anything like that continues to occur, you can have your bankruptcy lawyer handle that to have it stopped.
Filing bankruptcy will be recorded in your credit report for 10 years. This can be a big disadvantage down the road. You may have a problem for some time if you want to buy a home and get a mortgage loan. If you want to start a business after filing bankruptcy, it may prevent you from getting needed credit to grow your business.
These and other factors need to be considered when filing bankruptcy.
There may be other options. Some people have tried to get help from a credit counselor. You need to be cautious when looking into this option, because if you choose the wrong organization, you could end up paying out even more money.
What about a debt consolidation loan? That may be another alternative for you. When taking out a debt consolidation loan, you can manage your finances more easily and you may be able to pay your debts without filing bankruptcy.
Either of these options may work out better for you than actually filing bankruptcy. That is not something you want to do unless it is really necessary and you have no other viable options.
Depending on the situation you are in, there could be different options for you to look at. Filing Chapter 7 bankruptcy should be your last resort. If possible, you do want to pay back what you owe and learn to be more careful when it comes to spending money.
According to some statistics, quite a few people have had a large amount of medical expenses and are not able to pay these back. In a given situation like this, your best option may be to discuss it with a bankruptcy lawyer who is familiar with the laws in your state and get their advice on what you should do.
For more insights and additional information about Filing Bankruptcy and a free consultation with a bankruptcy lawyer local to you, please visit our web site at http://www.bankruptcy-data.com
http://ezinearticles.com/?Things-To-Consider-When-You-Are-Filing-Bankruptcy&id=651332
Friday, July 20, 2007
Five Rules to Consider Before Filing Banckruptcy
Upon first recognition that you need to take drastic measures against your mounting pile of bad credit, it can be overwhelming. So many different avenues to take, do you want to file chapter 13 bankruptcy or do you qualify for chapter 7? And how exactly is chapter 11 bankruptcy any different? You’ve made the tough decision to file bankruptcy, now you just don’t know where to start. Here are some tips on what to do first when facing a financial crisis.
Bankruptcy Rule 1: Stop using your credit cards. Using credit cards with intent to file for bankruptcy will give creditors the opportunity to challenge your discharge of the debt. If you’ve accumulated the debt knowing you could not repay it creditors have the option to nullify your debt discharge- usually done through a lawsuit or adversary proceeding. Lesson one, no more charging. Period.
Bankruptcy Rule 2: See to it that there are no other options for you to utilize. Between debt management, credit counseling, and all the untrustworthy organizations promising a quick fix, there is no doubt that it will require some homework. But do your research and make sure that there isn’t a more gentle method of cleaning up your credit before you resort to the big “B”.
Bankruptcy Rule 3: Once you’ve narrowed down your options and filing bankruptcy is the only one that seems like it will work for you and your situation, find a good lawyer. Many people try to go through this process on their own and end up losing big in the end. Proper legal council will guide you through the process, offer advice on which chapter of bankruptcy is best for you, and will be a huge asset if it comes down to negotiating for better terms with your creditors.
Bankruptcy Rule 4: Figure your costs. Bankruptcy filing fees vary widely from state to state and naturally different lawyers will have different fee schedules, some charging a flat fee, others charging based on how deeply you are in debt. Still other require you to pay up front before they even start the process, but once you have started working with a lawyer, refer all creditors to this office.
Bankruptcy Rule 5: Depending on whether you’re filing for chapter 7 or chapter 13 bankruptcy, prepare to give up some of your belongings. Exempt items such as tools of your trade and low value heirlooms are considered exempt items. All others fall in the non-exempt category and are likely to be sold so that payments can be made to your creditors. Payment amounts differ between chapters; in chapter 7 bankruptcy you may never have to pay a creditor and had all of your debt written off. However if filing for chapter 13 bankruptcy you will be put on a three to five year payment plan at the end of which any outstanding debt will be written off. Again a good lawyer will be able to tell you which one would help more for your specific situation.
If you file chapter 7 bankruptcy, on the 60th day after meeting with your creditors to negotiate the terms of your bankruptcy declaration, your creditors forfeit the right to challenge any and all of your discharge and you will receive a notice of discharge. This notice will come within 30 – 60 days after your final payment under a chapter 13 bankruptcy filing Best of luck in all your endeavors and may your financial recuperation be speedy.
http://www.add-articles.com/Article/Five-Rules-to-Consider-Before-Filing-Banckruptcy/3726
Bankruptcy Rule 1: Stop using your credit cards. Using credit cards with intent to file for bankruptcy will give creditors the opportunity to challenge your discharge of the debt. If you’ve accumulated the debt knowing you could not repay it creditors have the option to nullify your debt discharge- usually done through a lawsuit or adversary proceeding. Lesson one, no more charging. Period.
Bankruptcy Rule 2: See to it that there are no other options for you to utilize. Between debt management, credit counseling, and all the untrustworthy organizations promising a quick fix, there is no doubt that it will require some homework. But do your research and make sure that there isn’t a more gentle method of cleaning up your credit before you resort to the big “B”.
Bankruptcy Rule 3: Once you’ve narrowed down your options and filing bankruptcy is the only one that seems like it will work for you and your situation, find a good lawyer. Many people try to go through this process on their own and end up losing big in the end. Proper legal council will guide you through the process, offer advice on which chapter of bankruptcy is best for you, and will be a huge asset if it comes down to negotiating for better terms with your creditors.
Bankruptcy Rule 4: Figure your costs. Bankruptcy filing fees vary widely from state to state and naturally different lawyers will have different fee schedules, some charging a flat fee, others charging based on how deeply you are in debt. Still other require you to pay up front before they even start the process, but once you have started working with a lawyer, refer all creditors to this office.
Bankruptcy Rule 5: Depending on whether you’re filing for chapter 7 or chapter 13 bankruptcy, prepare to give up some of your belongings. Exempt items such as tools of your trade and low value heirlooms are considered exempt items. All others fall in the non-exempt category and are likely to be sold so that payments can be made to your creditors. Payment amounts differ between chapters; in chapter 7 bankruptcy you may never have to pay a creditor and had all of your debt written off. However if filing for chapter 13 bankruptcy you will be put on a three to five year payment plan at the end of which any outstanding debt will be written off. Again a good lawyer will be able to tell you which one would help more for your specific situation.
If you file chapter 7 bankruptcy, on the 60th day after meeting with your creditors to negotiate the terms of your bankruptcy declaration, your creditors forfeit the right to challenge any and all of your discharge and you will receive a notice of discharge. This notice will come within 30 – 60 days after your final payment under a chapter 13 bankruptcy filing Best of luck in all your endeavors and may your financial recuperation be speedy.
http://www.add-articles.com/Article/Five-Rules-to-Consider-Before-Filing-Banckruptcy/3726
Debt Relief or Bankruptcy
Money is a tricky thing and sometimes can be hard to manage. As many of us watch our debt pile up and the interest keeps accruing it can become very overwhelming and devastating. These factors are magnified by the confusion that creditors create with tricky payment terms and hidden and outrageous fees. Needless to say, when you are in over your head, creditors take very little sympathy for you. They want their money, and they don’t care how they get it.
If you are one of the millions of people in this country struggling to keep your head above water it often feels like it’s you against the world. When you have severe debt, there are usually two options, enlisting the services of a debt relief organization or declaring bankruptcy. While many of us know the ground rule for declaring bankruptcy, debt relief organizations are still huge benefactors about which, little is known. Debt relief services offer a way out. They can help consolidate your credit card bills, tuition loans, and medical bills all into one monthly payment that you and the debt relief organization set together. If you are in debt this is an excellent way to reduce your debt.
By using a debt relief organization you should no longer receive those harassing phone calls from collectors. The monthly payment is a fixed rate and will never increase. You are no longer dealing with collections or a specific credit card company. The debt relief process works by consolidating all your bills, and the debt relief organization makes an agreement with your credit card company to make the payments upon your behalf. In turn you pay the debit relief organization your monthly payments. Thus taking you out of direct contact with the creditors and reduces you debt faster than you could on your own without interest continuing to pile up.
Your alternate option to using a debt relief service is to declare bankruptcy. By declaring bankruptcy you are protecting all of your inherit assets and stating that you can not pay your debt off. This relinquishes you from debt and without paying back the money you owe. However it is strongly advised not to go this route as recovery from a bankruptcy declaration will take seven years to recuperate from on your credit report. Although it looks like the easier of the two, declaring bankruptcy has severe long term consequences. The chances of you ever having good credit again are nonexistent. It will be extremely difficult for you to obtain a loan or even a credit card. Another thing to take into account is whether you will ever need to make a large purchase such as a car or home. If you declare bankruptcy you are not longer qualified to receive a loan. Though there are a handful of organizations that will loan you money, they will only do so at tremendously high interest rates and sometimes unethical business practices.
There may be other options than these listed here that would require special circumstances and considerations. However these are the general choices you have. By going with a debit relief organization you are ensuring a better future you and your family. Declaring bankruptcy has negative consequences and should be considered a last resort. Remember, working with a debt relief organization should take up to five years to get everything paid off but being debt free is a wonderful feeling regardless on how you get there.
http://www.add-articles.com/Article/Debt-Relief-or-Bankruptcy/3766
If you are one of the millions of people in this country struggling to keep your head above water it often feels like it’s you against the world. When you have severe debt, there are usually two options, enlisting the services of a debt relief organization or declaring bankruptcy. While many of us know the ground rule for declaring bankruptcy, debt relief organizations are still huge benefactors about which, little is known. Debt relief services offer a way out. They can help consolidate your credit card bills, tuition loans, and medical bills all into one monthly payment that you and the debt relief organization set together. If you are in debt this is an excellent way to reduce your debt.
By using a debt relief organization you should no longer receive those harassing phone calls from collectors. The monthly payment is a fixed rate and will never increase. You are no longer dealing with collections or a specific credit card company. The debt relief process works by consolidating all your bills, and the debt relief organization makes an agreement with your credit card company to make the payments upon your behalf. In turn you pay the debit relief organization your monthly payments. Thus taking you out of direct contact with the creditors and reduces you debt faster than you could on your own without interest continuing to pile up.
Your alternate option to using a debt relief service is to declare bankruptcy. By declaring bankruptcy you are protecting all of your inherit assets and stating that you can not pay your debt off. This relinquishes you from debt and without paying back the money you owe. However it is strongly advised not to go this route as recovery from a bankruptcy declaration will take seven years to recuperate from on your credit report. Although it looks like the easier of the two, declaring bankruptcy has severe long term consequences. The chances of you ever having good credit again are nonexistent. It will be extremely difficult for you to obtain a loan or even a credit card. Another thing to take into account is whether you will ever need to make a large purchase such as a car or home. If you declare bankruptcy you are not longer qualified to receive a loan. Though there are a handful of organizations that will loan you money, they will only do so at tremendously high interest rates and sometimes unethical business practices.
There may be other options than these listed here that would require special circumstances and considerations. However these are the general choices you have. By going with a debit relief organization you are ensuring a better future you and your family. Declaring bankruptcy has negative consequences and should be considered a last resort. Remember, working with a debt relief organization should take up to five years to get everything paid off but being debt free is a wonderful feeling regardless on how you get there.
http://www.add-articles.com/Article/Debt-Relief-or-Bankruptcy/3766
The Last Debt Solution Should Be Bankruptcy
A debt solution like bankruptcy should really only be used as a last possible solution. The problem with this solution of debt problems is that it includes a lot more than simply eliminating debt. When someone declares them self bankrupted, all debt collection actions against that person are prevented. The court grants an "automatic stay", which - with a few exceptions means that creditors cannot come after the money owed to them.
The most important exception is that when a loan is secured by property creditors can seek relief from the stay and seize that property. The other exceptions are student loan debt, alimony, child support and taxes. The backside for the person who seeks this solution to eliminate his debt is that he or she must hand over all non-exempt property. This property is then sold and the proceeds are distributed amongst the creditors.
There are two types of this solution of your debt problems:.
Chapter 7
which states that a person is required to hand over much of their property, but creditors cannot seek damages from further income.
Chapter 13
allows a person to keep most of their income, but have to make a plan to pay the debt back to creditors based on their future income. Under this plan, the court can require individuals to live within a very strict budget.
As you see, there are downsides to both debt elimination plans. One of the biggest downside is that both debt erase plans will significantly impact a person's credit rate. For this reason, declaring yourself bankrupt is a solution of your debt problems that should be evaluated very thoroughly and carefully. Other debt solutions like debt negotiation, debt counselling and debt consolidation should definitely be considered first.
http://www.add-articles.com/Article/The-Last-Debt-Solution-Should-Be-Bankruptcy/5394
The most important exception is that when a loan is secured by property creditors can seek relief from the stay and seize that property. The other exceptions are student loan debt, alimony, child support and taxes. The backside for the person who seeks this solution to eliminate his debt is that he or she must hand over all non-exempt property. This property is then sold and the proceeds are distributed amongst the creditors.
There are two types of this solution of your debt problems:.
Chapter 7
which states that a person is required to hand over much of their property, but creditors cannot seek damages from further income.
Chapter 13
allows a person to keep most of their income, but have to make a plan to pay the debt back to creditors based on their future income. Under this plan, the court can require individuals to live within a very strict budget.
As you see, there are downsides to both debt elimination plans. One of the biggest downside is that both debt erase plans will significantly impact a person's credit rate. For this reason, declaring yourself bankrupt is a solution of your debt problems that should be evaluated very thoroughly and carefully. Other debt solutions like debt negotiation, debt counselling and debt consolidation should definitely be considered first.
http://www.add-articles.com/Article/The-Last-Debt-Solution-Should-Be-Bankruptcy/5394
How To Know The Facts from the Myths In Bankruptcy
If you are contemplating the possibility or prospect of filing for bankruptcy, you likely have in mind a number of myths about the process and procedure of bankruptcy. (You may also have some basic facts about bankruptcy, but desire more before you make a final decision as to whether or not you want to proceed with such an action.) Through this article, the basic facts and some common myths about bankruptcy are discussed.
1. One of the most common myths associated with bankruptcy is that a bankruptcy permanently damages your credit history. While it is true that a bankruptcy will appear on your credit history for a period of seven to nine years, it does not remain on your credit report or part of your credit history indefinitely.
2. Another of the common myths associated with bankruptcy is that all of your debts simply “go away” or “vanish” after you have filed for relief. In point of fact, not all of your debts will be discharge through a bankruptcy action. Indeed, in recent times, lawmakers have made it more difficult for consumers to rid themselves of certain types of debt through the bankruptcy process. For example, debt that people have amassed on credit cards is no longer easy to dispose of in bankruptcy court.
3. One of the myths (or confusions) associated with bankruptcy centers on the different between secured and unsecured debt. Many people assume that all debt is the same. In point of fact, when it comes to seeking and obtaining bankruptcy relief, there is a significant different between secured and unsecured debt. An example of unsecured debt is that debt that you accrue on a typical credit card. As an example, if you charge food, gasoline and the like on your credit card, the balance on your credit card is considered unsecured debt.
As an aside, you do need to keep in mind that there are some credit card charges that end up as secured loans. In other words, if you let the credit card become delinquent, certain items that you have purchased on a credit card may be repossessed. An example, of such a card is a credit card provided by a retailer that sells appliances and electronics. In many instances, these stores do take a lien interest in the property sold to you. And, if you end up defaulting on the credit card, they can and oftentimes do repossess the property in question.
A prime example of secured debt is the mortgage on your home. The amount of money that you have been provided in the form of a loan is “secured” by your home itself. In other words, if you default on the loan, the lender has the ability to foreclose on the home and take your house as a means of satisfying what is due and owing on the loan itself. Another example of a secured loan would be the loan on your motor vehicle. As with the house, if you default on your car loan, the lender has the chance to repossess the vehicle to satisfy the outstanding balance on the loan itself.
In bankruptcy, when it comes to a secured loan, you have the ability (in most instances) to execute what is known as a reaffirmation agreement. Through a reaffirmation agreement you have the ability to continue to make payments on your mortgage or car payments and you will be able to keep the residence or the automobile.
4. Another of the common myths associated with the bankruptcy process is that it is easy. Many people think that they can trot off to the bankruptcy courthouse on their own and file a petition without a hassle. In reality, consumer bankruptcies can be very complicated. Therefore, in the vast majority of cases, a consumer is well served obtaining the assistance of a qualified lawyer to assist with the case. An experienced lawyer can and usually does make a world of difference when it comes to this type of legal relief for a consumer.
By understanding the myths and facts associated with bankruptcy, you will be able to determine if bankruptcy is the best option for you. By understanding the facts of bankruptcy, you will have taken the first step on the road to bringing order to your financial house.
http://www.add-articles.com/Article/How-To-Know-The-Facts-from-the-Myths-In-Bankruptcy/11326
1. One of the most common myths associated with bankruptcy is that a bankruptcy permanently damages your credit history. While it is true that a bankruptcy will appear on your credit history for a period of seven to nine years, it does not remain on your credit report or part of your credit history indefinitely.
2. Another of the common myths associated with bankruptcy is that all of your debts simply “go away” or “vanish” after you have filed for relief. In point of fact, not all of your debts will be discharge through a bankruptcy action. Indeed, in recent times, lawmakers have made it more difficult for consumers to rid themselves of certain types of debt through the bankruptcy process. For example, debt that people have amassed on credit cards is no longer easy to dispose of in bankruptcy court.
3. One of the myths (or confusions) associated with bankruptcy centers on the different between secured and unsecured debt. Many people assume that all debt is the same. In point of fact, when it comes to seeking and obtaining bankruptcy relief, there is a significant different between secured and unsecured debt. An example of unsecured debt is that debt that you accrue on a typical credit card. As an example, if you charge food, gasoline and the like on your credit card, the balance on your credit card is considered unsecured debt.
As an aside, you do need to keep in mind that there are some credit card charges that end up as secured loans. In other words, if you let the credit card become delinquent, certain items that you have purchased on a credit card may be repossessed. An example, of such a card is a credit card provided by a retailer that sells appliances and electronics. In many instances, these stores do take a lien interest in the property sold to you. And, if you end up defaulting on the credit card, they can and oftentimes do repossess the property in question.
A prime example of secured debt is the mortgage on your home. The amount of money that you have been provided in the form of a loan is “secured” by your home itself. In other words, if you default on the loan, the lender has the ability to foreclose on the home and take your house as a means of satisfying what is due and owing on the loan itself. Another example of a secured loan would be the loan on your motor vehicle. As with the house, if you default on your car loan, the lender has the chance to repossess the vehicle to satisfy the outstanding balance on the loan itself.
In bankruptcy, when it comes to a secured loan, you have the ability (in most instances) to execute what is known as a reaffirmation agreement. Through a reaffirmation agreement you have the ability to continue to make payments on your mortgage or car payments and you will be able to keep the residence or the automobile.
4. Another of the common myths associated with the bankruptcy process is that it is easy. Many people think that they can trot off to the bankruptcy courthouse on their own and file a petition without a hassle. In reality, consumer bankruptcies can be very complicated. Therefore, in the vast majority of cases, a consumer is well served obtaining the assistance of a qualified lawyer to assist with the case. An experienced lawyer can and usually does make a world of difference when it comes to this type of legal relief for a consumer.
By understanding the myths and facts associated with bankruptcy, you will be able to determine if bankruptcy is the best option for you. By understanding the facts of bankruptcy, you will have taken the first step on the road to bringing order to your financial house.
http://www.add-articles.com/Article/How-To-Know-The-Facts-from-the-Myths-In-Bankruptcy/11326
Will Changes In Bankruptcy Laws Affect You?
There are 2 sides to the changes in bankruptcy rules.
It will be a lot harder to file bankruptcy under chapter 7 and get a totally clean slate.
For businesses, relying on issuing credit, the new personal bankruptcy law is doing great, reducing personal bankruptcy claims from the thousands to double digits.(In the short run).
However, lawyers working with the actual people filing for bankruptcy say that the new law is seriously flawed because it puts more financial burdens on already broke clients and reduces potential debt repayment to small businesses.
And then of course you have the credit card companies charging high interest rates which in quite a few cases caused the bankruptcy in the first place.
According to some financial specialists, much of the debt people accumulate is a result of keeping up with the Joneses and not thinking ahead.
For 80% of clients counseled each month, the debt is credit card related and averages $32,000 - a result of six to eight cards.
Consumer credit organizations say the new law provides debt-reducing strategies for those considering filing bankruptcy and curbs abuse.
Under the new law it has become a requirement that the person filing bankruptcy obtains credit counseling both before and after filing for which that person will be charged..
So now the consumer would then know the advantages and disadvantages of declaring bankruptcy. Yet it seems merely another expense for an already financially stressed individual.
People filing bankruptcy in general are not overspenders, but merely faced with temporary financial disasters such as medical costs, layoffs, a divorce, gambling debts or other crises.
Before you can file bankruptcy,you are now required to complete credit counseling with an agency approved by the U.S. Trustees office.
This credit counseling is designed to help you determine whether or not bankruptcy is appropriate.
Once you complete your bankruptcy, the law requires you to attend another credit counseling session.
These are new requirements, before this law was passed the law did not require a person to go through counseling either before or after the filing of bankruptcy.
Second, under the old law, a person could decide to file under Chapter 7 or Chapter 13. Under the new law, the court will look at your monthly income and apply a means test relating to the state in which you live. If your income is less than or equal to the medium income then you will be allowed to file Chapter 7 which in effect will give you a clean slate.
This medium income can vary from $28,000 in Missouri to $56,000 in Alaska.
If your income is greater, you may be forced to file Chapter 13 unless you can demonstrate you do not have enough disposable income.
Under Chapter 13 you will not get a clean slate but will have to make payments on your debts.
Also, your attorney now has to personally certify that your bankruptcy filing is accurate. This means more work for the attorney, with higher legal fees.
Advantages of declaring Bankruptcy:
Legal protection from creditors
Takes care of all or most debt
In some cases, can keep home and car
May stop complete financial ruin
Provides a fresh start
Disadvantages of declaring Bankruptcy:
Bad credit
May have to repay partial debt load and return collateral to creditors
May lose assets, including house and car (If the house is worth more than a certain amount).
Bankruptcy becomes public record, and
Remains on credit record for seven to 10 years
“In the past, a bankruptcy offered a fresh start for the filer,” said Columbia attorney Gwen Froeschner Hart. “The new federal legislation offers language directed at helping creditors.”
If you analyze credit card expenses for most people you'll see that they often include medical bills and day-to-day expenses for the elderly or those earning low or fixed incomes.
Records show that 50% of credit card holders do not pay their full credit card bills every month.
33% of the population can't afford medical insurance so have to charge their prescription drugs.
With the recent Medicaid cuts and rigid bankruptcy legislation who knows what is going to happen to these people.
There are some who say consumers are abusing creditors.
The irony is that credit card companies are begging for customers and offering large amounts of unsecured credit, yet at the same time, lobbying for stricter debt controls.
http://www.add-articles.com/Article/Will-Changes-In-Bankruptcy-Laws-Affect-You-/11503
It will be a lot harder to file bankruptcy under chapter 7 and get a totally clean slate.
For businesses, relying on issuing credit, the new personal bankruptcy law is doing great, reducing personal bankruptcy claims from the thousands to double digits.(In the short run).
However, lawyers working with the actual people filing for bankruptcy say that the new law is seriously flawed because it puts more financial burdens on already broke clients and reduces potential debt repayment to small businesses.
And then of course you have the credit card companies charging high interest rates which in quite a few cases caused the bankruptcy in the first place.
According to some financial specialists, much of the debt people accumulate is a result of keeping up with the Joneses and not thinking ahead.
For 80% of clients counseled each month, the debt is credit card related and averages $32,000 - a result of six to eight cards.
Consumer credit organizations say the new law provides debt-reducing strategies for those considering filing bankruptcy and curbs abuse.
Under the new law it has become a requirement that the person filing bankruptcy obtains credit counseling both before and after filing for which that person will be charged..
So now the consumer would then know the advantages and disadvantages of declaring bankruptcy. Yet it seems merely another expense for an already financially stressed individual.
People filing bankruptcy in general are not overspenders, but merely faced with temporary financial disasters such as medical costs, layoffs, a divorce, gambling debts or other crises.
Before you can file bankruptcy,you are now required to complete credit counseling with an agency approved by the U.S. Trustees office.
This credit counseling is designed to help you determine whether or not bankruptcy is appropriate.
Once you complete your bankruptcy, the law requires you to attend another credit counseling session.
These are new requirements, before this law was passed the law did not require a person to go through counseling either before or after the filing of bankruptcy.
Second, under the old law, a person could decide to file under Chapter 7 or Chapter 13. Under the new law, the court will look at your monthly income and apply a means test relating to the state in which you live. If your income is less than or equal to the medium income then you will be allowed to file Chapter 7 which in effect will give you a clean slate.
This medium income can vary from $28,000 in Missouri to $56,000 in Alaska.
If your income is greater, you may be forced to file Chapter 13 unless you can demonstrate you do not have enough disposable income.
Under Chapter 13 you will not get a clean slate but will have to make payments on your debts.
Also, your attorney now has to personally certify that your bankruptcy filing is accurate. This means more work for the attorney, with higher legal fees.
Advantages of declaring Bankruptcy:
Legal protection from creditors
Takes care of all or most debt
In some cases, can keep home and car
May stop complete financial ruin
Provides a fresh start
Disadvantages of declaring Bankruptcy:
Bad credit
May have to repay partial debt load and return collateral to creditors
May lose assets, including house and car (If the house is worth more than a certain amount).
Bankruptcy becomes public record, and
Remains on credit record for seven to 10 years
“In the past, a bankruptcy offered a fresh start for the filer,” said Columbia attorney Gwen Froeschner Hart. “The new federal legislation offers language directed at helping creditors.”
If you analyze credit card expenses for most people you'll see that they often include medical bills and day-to-day expenses for the elderly or those earning low or fixed incomes.
Records show that 50% of credit card holders do not pay their full credit card bills every month.
33% of the population can't afford medical insurance so have to charge their prescription drugs.
With the recent Medicaid cuts and rigid bankruptcy legislation who knows what is going to happen to these people.
There are some who say consumers are abusing creditors.
The irony is that credit card companies are begging for customers and offering large amounts of unsecured credit, yet at the same time, lobbying for stricter debt controls.
http://www.add-articles.com/Article/Will-Changes-In-Bankruptcy-Laws-Affect-You-/11503
The Facts About Personal Bankruptcy
The thought of personal bankruptcy is very frightening, however over 5.4 per 1,000 people have filed for bankruptcy last year, and this rate has been growing at an average of nearly 7 percent. Researchers have determined that the primary cause of personal bankruptcy is uncontrollable levels of consumer debt oftentimes coupled with an unexpected event, such as a major medical expense not covered by insurance, the loss of a job, divorce or death of a spouse. According to economists’ surveys, the classic bankruptcy filer is a blue collar, high school graduate who is the head of a household in the lower middle-income class with heavy use of credit. In order to protect both debtor, and creditor, laws were enacted to provide equal, and fair measures to satisfy the objectives of all parties. The primary purpose of the laws of bankruptcy are: (1) to give an honest debtor a fresh start in life by relieving the debtor of most debts, and (2) to repay creditors in an orderly manner to the extent that the debtor has property available for payment.
There are two types of structured plans for filing for personal bankruptcy, Chapter 7 or Chapter 13. Over two-thirds of personal filers choose Chapter 7 bankruptcy. Basically Chapter 7 requires the debtor to liquidate all non-exempt assets, and have them distributed among creditors. Some examples of exempt assets include equity in a primary residence, and a retirement program. On the other hand, Chapter 13 does not require liquidation, rather a debtor agrees to a specific payment plan, whereby a portion of any unsecured debts is paid, and the balance is forgiven. It must be stressed, that under both plans, certain debts are ineligible for bankruptcy protection. These debts include government student loans, child support, alimony, and income tax debt. These must be paid back in full.
Some analysts are concerned that this unprecedented level of debt might pose a risk to the financial health of American households. In an attempt to reverse the increasing trend in personal bankruptcy, the federal government has recently implemented sweeping bankruptcy reform legislation. On March 10, 2005, the Senate passed S. 256, the Bankruptcy Abuse Prevention and Consumer Protection Act of 2005. On April 20th, President Bush signed into law the Bankruptcy Abuse Prevention and Consumer Protection Act of 2005 (Bankruptcy Act of 2005). This act makes filing for bankruptcy more difficult through income-means testing, tougher guidelines for the homestead exemption, increased lawyer liability and required credit counseling.
http://www.add-articles.com/Article/The-Facts-About-Personal-Bankruptcy/10707
There are two types of structured plans for filing for personal bankruptcy, Chapter 7 or Chapter 13. Over two-thirds of personal filers choose Chapter 7 bankruptcy. Basically Chapter 7 requires the debtor to liquidate all non-exempt assets, and have them distributed among creditors. Some examples of exempt assets include equity in a primary residence, and a retirement program. On the other hand, Chapter 13 does not require liquidation, rather a debtor agrees to a specific payment plan, whereby a portion of any unsecured debts is paid, and the balance is forgiven. It must be stressed, that under both plans, certain debts are ineligible for bankruptcy protection. These debts include government student loans, child support, alimony, and income tax debt. These must be paid back in full.
Some analysts are concerned that this unprecedented level of debt might pose a risk to the financial health of American households. In an attempt to reverse the increasing trend in personal bankruptcy, the federal government has recently implemented sweeping bankruptcy reform legislation. On March 10, 2005, the Senate passed S. 256, the Bankruptcy Abuse Prevention and Consumer Protection Act of 2005. On April 20th, President Bush signed into law the Bankruptcy Abuse Prevention and Consumer Protection Act of 2005 (Bankruptcy Act of 2005). This act makes filing for bankruptcy more difficult through income-means testing, tougher guidelines for the homestead exemption, increased lawyer liability and required credit counseling.
http://www.add-articles.com/Article/The-Facts-About-Personal-Bankruptcy/10707
Thursday, July 19, 2007
When Bankrupting Is Worthwhile
For many business owners bankruptcy seems scary but, sometimes, declaring bankruptcy is a worthwhile strategy. If you are considering the possibility of declaring bankrupting for your business, this article will review some key points you must know. Two of the most popular types of bankruptcy include Chapter 7 and Chapter 11.
Under a Chapter 7 bankruptcy, the judge gets rid of the business debts while under a Chapter 11 bankruptcy the owner must create a plan to repay debtors. While Chapter 11 bankruptcy allows the business to continue running, bankrupting under Chapter 7 forces the closing or selling of the business.
Although these laws may seem gloomy, occasionally they are the business owner's most practical choice. A Chapter 7 bankruptcy is worthwhile when the business has no chance of making a future profit. It also makes sense if the company has no assets and the debts are insurmountable. In these cases, undergoing a bankruptcy may be the best decision the business owner can make.
Although bankruptcy is an option, it also has some negative outcomes. A business owner should always consider the legal fees associated with filing bankruptcy. They are often high for both Chapter 7 and Chapter 11. Some companies find themselves filing for bankruptcy only to close their business anyway to pay the legal fees. Remember that lawyers do not work for free. Get an estimate before you decide to file.
Recovering From Bankrupting Your Small Business
Small businesses owners bankrupting their companies should know that recovering from a Chapter 11 filing is possible. The goal of Chapter 11 bankruptcy is to place the company on more stable financial ground. While the courts relieve the company's debts, they also help in reorganizing it. They hope is to make it more profitable in the future. While this outcome appeals to many small business owners, they must realize that bankruptcy puts them at the mercy of the United States Trustee. The Trustee now oversees all business transactions until the company emerges from bankruptcy. For many business owners this is troubling. They have lost the freedom associated with running their own business. Business owners who are not comfortable with this degree of oversight should not seek out a Chapter 11 bankruptcy to solve their financial problems.
Avoiding Bankrupting
There are many useful tips for avoiding the need for bankrupting but unfortunately even with the best of plans there is always the possibility that bankruptcy is necessary. In these cases, it is wise for the business owners to recognize the need for it early on. This helps them avoid compounding the company's financial problems. In general the methods owners use to prevent bankruptcy are associated with to good, general business practices.
http://www.add-articles.com/Article/When-Bankrupting-Is-Worthwhile/77349
Under a Chapter 7 bankruptcy, the judge gets rid of the business debts while under a Chapter 11 bankruptcy the owner must create a plan to repay debtors. While Chapter 11 bankruptcy allows the business to continue running, bankrupting under Chapter 7 forces the closing or selling of the business.
Although these laws may seem gloomy, occasionally they are the business owner's most practical choice. A Chapter 7 bankruptcy is worthwhile when the business has no chance of making a future profit. It also makes sense if the company has no assets and the debts are insurmountable. In these cases, undergoing a bankruptcy may be the best decision the business owner can make.
Although bankruptcy is an option, it also has some negative outcomes. A business owner should always consider the legal fees associated with filing bankruptcy. They are often high for both Chapter 7 and Chapter 11. Some companies find themselves filing for bankruptcy only to close their business anyway to pay the legal fees. Remember that lawyers do not work for free. Get an estimate before you decide to file.
Recovering From Bankrupting Your Small Business
Small businesses owners bankrupting their companies should know that recovering from a Chapter 11 filing is possible. The goal of Chapter 11 bankruptcy is to place the company on more stable financial ground. While the courts relieve the company's debts, they also help in reorganizing it. They hope is to make it more profitable in the future. While this outcome appeals to many small business owners, they must realize that bankruptcy puts them at the mercy of the United States Trustee. The Trustee now oversees all business transactions until the company emerges from bankruptcy. For many business owners this is troubling. They have lost the freedom associated with running their own business. Business owners who are not comfortable with this degree of oversight should not seek out a Chapter 11 bankruptcy to solve their financial problems.
Avoiding Bankrupting
There are many useful tips for avoiding the need for bankrupting but unfortunately even with the best of plans there is always the possibility that bankruptcy is necessary. In these cases, it is wise for the business owners to recognize the need for it early on. This helps them avoid compounding the company's financial problems. In general the methods owners use to prevent bankruptcy are associated with to good, general business practices.
http://www.add-articles.com/Article/When-Bankrupting-Is-Worthwhile/77349
Bankruptcy LLC Explained
Since Limited Liability Corporations (LLC) are a relatively new type of business entity, LLC owners have some difficulty finding out how courts will treat their bankruptcy LLC cases. As an LLC declaring bankruptcy, the owner may get some liability protection since their business is a separate legal entity. However, this protection is not absolute. Why? B ecause as CEO of the legal entity, the owner has fiduciary duties that effectively give them the same liabilities as a sole proprietorship.
So some important questions remain. Will the judge treat them like an LLC, as a corporation or as a partnership? What will happen during a bankruptcy LLC when the company has only one owner? Currently, there is no code or law that directly addresses bankruptcy LLC proceedings.
Partnership Versus Corporation In Bankruptcy LLC
There are two different ways a bankruptcy court may handle the case of Limited Liability Corporation with a single owner. First, the judge may treat the bankruptcy LLC like a partnership. In this case the court would dissolve the LLC and deal out all remaining assets to creditors. Anything remaining goes to the owner. And as in most business bankruptcy cases, there isn't usually much left.
But the judge may decide the LLC is a corporation. Here the judge would not dissolve the owner from the bankruptcy LLC. The former owner could give over ownership interest to another party. If the former owner decided not to do this, the bankruptcy judge would treat the former owner like a corporate shareholder. The owner would not have to give up stockholdings, just as a shareholder wouldn't in a large corporation bankruptcy case. Usually under this scenrio, the owner ends up a little better off.
Legalities of a Bankruptcy LLC
One of the greatest drawbacks to filing bankruptcy as an LLC is that owner has no idea how the judge will treat them. Unfortunately, there are no specific rules for dealing with a Limited Liability Corporation in a business bankruptcy filing.
Because of this, there may be several different factors that a bankruptcy court considers when deciding what to do. The most important factor is the number of member owners in the corporation. That said bankruptcy laws do not define the number of individual owners a corporation must have, especially for an LLC.
Because the lines are so blurry here, it is hard to tell how the bankruptcy court will decide who needs to consent to the bankruptcy filing. All members of the LLC may have to consent to the bankruptcy LLC filing. On the contrary if the judge treats it like a corporation, then only one member must consent. Most often in LLC proceedings, the bankruptcy judge looks to state laws and codes to determine how to deal with the bankruptcy. Therefore these proceedings may vary from state to state.
Filing The Bankruptcy LLC
Before filing for bankruptcy as a corporation or partnership, schedule an appointment with a bankruptcy lawyer to discuss these issues. As an alternative, you can also talk to state or county bankruptcy officials who can clarify how they will determine the proper procedures for bankruptcy LLC. Make sure you interview several lawyers before you select one. They should specialize in bankruptcy and be well versed in the specific rules for your state. If possible, try to find an attorney who has experience filing bankruptcy cases for Limited Liability Corporations.
http://www.add-articles.com/Article/Bankruptcy-LLC-Explained/77357
So some important questions remain. Will the judge treat them like an LLC, as a corporation or as a partnership? What will happen during a bankruptcy LLC when the company has only one owner? Currently, there is no code or law that directly addresses bankruptcy LLC proceedings.
Partnership Versus Corporation In Bankruptcy LLC
There are two different ways a bankruptcy court may handle the case of Limited Liability Corporation with a single owner. First, the judge may treat the bankruptcy LLC like a partnership. In this case the court would dissolve the LLC and deal out all remaining assets to creditors. Anything remaining goes to the owner. And as in most business bankruptcy cases, there isn't usually much left.
But the judge may decide the LLC is a corporation. Here the judge would not dissolve the owner from the bankruptcy LLC. The former owner could give over ownership interest to another party. If the former owner decided not to do this, the bankruptcy judge would treat the former owner like a corporate shareholder. The owner would not have to give up stockholdings, just as a shareholder wouldn't in a large corporation bankruptcy case. Usually under this scenrio, the owner ends up a little better off.
Legalities of a Bankruptcy LLC
One of the greatest drawbacks to filing bankruptcy as an LLC is that owner has no idea how the judge will treat them. Unfortunately, there are no specific rules for dealing with a Limited Liability Corporation in a business bankruptcy filing.
Because of this, there may be several different factors that a bankruptcy court considers when deciding what to do. The most important factor is the number of member owners in the corporation. That said bankruptcy laws do not define the number of individual owners a corporation must have, especially for an LLC.
Because the lines are so blurry here, it is hard to tell how the bankruptcy court will decide who needs to consent to the bankruptcy filing. All members of the LLC may have to consent to the bankruptcy LLC filing. On the contrary if the judge treats it like a corporation, then only one member must consent. Most often in LLC proceedings, the bankruptcy judge looks to state laws and codes to determine how to deal with the bankruptcy. Therefore these proceedings may vary from state to state.
Filing The Bankruptcy LLC
Before filing for bankruptcy as a corporation or partnership, schedule an appointment with a bankruptcy lawyer to discuss these issues. As an alternative, you can also talk to state or county bankruptcy officials who can clarify how they will determine the proper procedures for bankruptcy LLC. Make sure you interview several lawyers before you select one. They should specialize in bankruptcy and be well versed in the specific rules for your state. If possible, try to find an attorney who has experience filing bankruptcy cases for Limited Liability Corporations.
http://www.add-articles.com/Article/Bankruptcy-LLC-Explained/77357
Wednesday, July 18, 2007
Business Bankruptcy Not Always Best Option
When a company is in dire straits, often a business bankruptcy seems enticing. Your debt will disappear, and, if the company has filed under Chapter 11 bankruptcy, the "fresh start" offered by the reorganization is hard to pass up. But it is not all it's cracked up to be.
Good Reasons Why Business Bankruptcy Not Always Best Solution
But doing a filing isn't always the best answer. For some companies, it could be the wrong answer, while for others, there might be better options. Here are some reasons why it isn't always the best choice.
1. You could lose much of the control over your company. Many executives believe the bankruptcy laws allow them to control their company's activities during a Chapter 11 bankruptcy. But this is misleading. Bankruptcy experts say business owners must understand that other individuals will oversee and direct their decisions during a business bankruptcy. Some of these people include debtors, shareholders, and the court trustees.
2. Business bankruptcy is expensive. Depending on the size of your debt, it might be more expensive to file than to continue to run your business and try to save it. If you choose to file business bankruptcy, you'll have to hire good counsel, and often other professionals who will charge a hefty fee for their services. These costs often surprise business owners so consider them before you decide to go down this path.
3. Business bankruptcy can take more time than you expect. This process isn't a quick fix. You don't file bankruptcy, see a quick turnaround of your fortune, complete the bankruptcy and return to business as usual. Depending on your jurisdiction, court may only hold hearings once a month. Sometimes, the court may delay these hearings that are essential to the day-to-day running of your business. This will slow down the whole course of the process. If you choose to file, understand that there will be numerous "sit down and wait" moments for you.
4. Your employees might flee during the process. Even if the you are filing a Chapter 11, or reorganization bankruptcy, many employees might mistakenly believe the company is in such dire straits as their job is in danger. Even if you reassure your employees, you are sure to lose a few or more as people seek more stable employment elsewhere. During this already difficult time, you'll have to hire more employees, or make do with fewer people if hiring new employees is not possible. If you do hire more people, consider the cost of hiring, training and "breaking in" new workers.
Before you decide to file, make sure you know all your options. If Chapter 11 still looks like a good choice, do your homework. Find out about the filing process and know what to expect. Also make sure you get a competent bankruptcy lawyer to represent you and your company. The future of your business depends on it.
http://www.bestnichearticles.com/Article/Business-Bankruptcy-Not-Always-Best-Option/64427
Good Reasons Why Business Bankruptcy Not Always Best Solution
But doing a filing isn't always the best answer. For some companies, it could be the wrong answer, while for others, there might be better options. Here are some reasons why it isn't always the best choice.
1. You could lose much of the control over your company. Many executives believe the bankruptcy laws allow them to control their company's activities during a Chapter 11 bankruptcy. But this is misleading. Bankruptcy experts say business owners must understand that other individuals will oversee and direct their decisions during a business bankruptcy. Some of these people include debtors, shareholders, and the court trustees.
2. Business bankruptcy is expensive. Depending on the size of your debt, it might be more expensive to file than to continue to run your business and try to save it. If you choose to file business bankruptcy, you'll have to hire good counsel, and often other professionals who will charge a hefty fee for their services. These costs often surprise business owners so consider them before you decide to go down this path.
3. Business bankruptcy can take more time than you expect. This process isn't a quick fix. You don't file bankruptcy, see a quick turnaround of your fortune, complete the bankruptcy and return to business as usual. Depending on your jurisdiction, court may only hold hearings once a month. Sometimes, the court may delay these hearings that are essential to the day-to-day running of your business. This will slow down the whole course of the process. If you choose to file, understand that there will be numerous "sit down and wait" moments for you.
4. Your employees might flee during the process. Even if the you are filing a Chapter 11, or reorganization bankruptcy, many employees might mistakenly believe the company is in such dire straits as their job is in danger. Even if you reassure your employees, you are sure to lose a few or more as people seek more stable employment elsewhere. During this already difficult time, you'll have to hire more employees, or make do with fewer people if hiring new employees is not possible. If you do hire more people, consider the cost of hiring, training and "breaking in" new workers.
Before you decide to file, make sure you know all your options. If Chapter 11 still looks like a good choice, do your homework. Find out about the filing process and know what to expect. Also make sure you get a competent bankruptcy lawyer to represent you and your company. The future of your business depends on it.
http://www.bestnichearticles.com/Article/Business-Bankruptcy-Not-Always-Best-Option/64427
Business Bankruptcy Not Always Best Option
When a company is in dire straits, often a business bankruptcy seems enticing. Your debt will disappear, and, if the company has filed under Chapter 11 bankruptcy, the "fresh start" offered by the reorganization is hard to pass up. But it is not all it's cracked up to be.
Good Reasons Why Business Bankruptcy Not Always Best Solution
But doing a filing isn't always the best answer. For some companies, it could be the wrong answer, while for others, there might be better options. Here are some reasons why it isn't always the best choice.
1. You could lose much of the control over your company. Many executives believe the bankruptcy laws allow them to control their company's activities during a Chapter 11 bankruptcy. But this is misleading. Bankruptcy experts say business owners must understand that other individuals will oversee and direct their decisions during a business bankruptcy. Some of these people include debtors, shareholders, and the court trustees.
2. Business bankruptcy is expensive. Depending on the size of your debt, it might be more expensive to file than to continue to run your business and try to save it. If you choose to file business bankruptcy, you'll have to hire good counsel, and often other professionals who will charge a hefty fee for their services. These costs often surprise business owners so consider them before you decide to go down this path.
3. Business bankruptcy can take more time than you expect. This process isn't a quick fix. You don't file bankruptcy, see a quick turnaround of your fortune, complete the bankruptcy and return to business as usual. Depending on your jurisdiction, court may only hold hearings once a month. Sometimes, the court may delay these hearings that are essential to the day-to-day running of your business. This will slow down the whole course of the process. If you choose to file, understand that there will be numerous "sit down and wait" moments for you.
4. Your employees might flee during the process. Even if the you are filing a Chapter 11, or reorganization bankruptcy, many employees might mistakenly believe the company is in such dire straits as their job is in danger. Even if you reassure your employees, you are sure to lose a few or more as people seek more stable employment elsewhere. During this already difficult time, you'll have to hire more employees, or make do with fewer people if hiring new employees is not possible. If you do hire more people, consider the cost of hiring, training and "breaking in" new workers.
Before you decide to file, make sure you know all your options. If Chapter 11 still looks like a good choice, do your homework. Find out about the filing process and know what to expect. Also make sure you get a competent bankruptcy lawyer to represent you and your company. The future of your business depends on it.
http://www.bestnichearticles.com/Article/Business-Bankruptcy-Not-Always-Best-Option/64427
Good Reasons Why Business Bankruptcy Not Always Best Solution
But doing a filing isn't always the best answer. For some companies, it could be the wrong answer, while for others, there might be better options. Here are some reasons why it isn't always the best choice.
1. You could lose much of the control over your company. Many executives believe the bankruptcy laws allow them to control their company's activities during a Chapter 11 bankruptcy. But this is misleading. Bankruptcy experts say business owners must understand that other individuals will oversee and direct their decisions during a business bankruptcy. Some of these people include debtors, shareholders, and the court trustees.
2. Business bankruptcy is expensive. Depending on the size of your debt, it might be more expensive to file than to continue to run your business and try to save it. If you choose to file business bankruptcy, you'll have to hire good counsel, and often other professionals who will charge a hefty fee for their services. These costs often surprise business owners so consider them before you decide to go down this path.
3. Business bankruptcy can take more time than you expect. This process isn't a quick fix. You don't file bankruptcy, see a quick turnaround of your fortune, complete the bankruptcy and return to business as usual. Depending on your jurisdiction, court may only hold hearings once a month. Sometimes, the court may delay these hearings that are essential to the day-to-day running of your business. This will slow down the whole course of the process. If you choose to file, understand that there will be numerous "sit down and wait" moments for you.
4. Your employees might flee during the process. Even if the you are filing a Chapter 11, or reorganization bankruptcy, many employees might mistakenly believe the company is in such dire straits as their job is in danger. Even if you reassure your employees, you are sure to lose a few or more as people seek more stable employment elsewhere. During this already difficult time, you'll have to hire more employees, or make do with fewer people if hiring new employees is not possible. If you do hire more people, consider the cost of hiring, training and "breaking in" new workers.
Before you decide to file, make sure you know all your options. If Chapter 11 still looks like a good choice, do your homework. Find out about the filing process and know what to expect. Also make sure you get a competent bankruptcy lawyer to represent you and your company. The future of your business depends on it.
http://www.bestnichearticles.com/Article/Business-Bankruptcy-Not-Always-Best-Option/64427
Chapters 7 and 13 Bankruptcy Laws
Some laws to filing chapter 7 or 13 bankruptcy are common knowledge, such as the requirement for all filers to undergo debt or credit counseling to help better educate them on their spending habits. There is also the law stating that debtors with higher incomes will have to repay a portion of their debt prior to being allowed to file for chapter 13 bankruptcy. However, there have been laws recently taken into effect that are little known and need to be observed.
Chapter 7 Bankruptcy Restrictions
The most common form of bankruptcy just got a little more exclusive. Under the old rules people could decide which chapter of bankruptcy was best for them- most choosing chapter 7. However, those with higher incomes must now be aware that they may not qualify to file for chapter 7 bankruptcy and will be forced to file under chapter 13. The gauge they use to decipher “high income families” is to compare your current monthly income with that of the median monthly income of a family of similar size in your state. Another factor to account for is how you current monthly income will be calculated. It is not what you are currently making at the time when you file for bankruptcy but rather an average of your income from the six months prior to making your claim. This poses a big problem for those who are filing bankruptcy after recently losing a job.
Restrictions on Lawyers
Among the new laws lawyers much personally vouch for the accuracy of the information provided. Thus, time spend on each bankruptcy case will increase, in turn driving up your lawyer bill.
Can You Live On Less?
Under the old rules, those who filed for chapter 13 did have to devote all disposable income to a payment plan. The new laws make this a little more challenging. In addition to handing over all disposable income, chapter 13 filers will have to calculate that amount from an expense amount allowed by the IRS- meaning they get to dictate what your living costs should be. Keeping in mind under chapter 13 you are still required to calculate disposable income according to an average of what you had made over the last six months.
Value Your Property at Replacement Cost
In the past heirlooms and other property that a debtor might want to keep were expected to be of little value- deeming them exempt. However, new laws force you to value all property at retail value taking into consideration age and condition- a requirement that, in most cases, will inflate the cost of your property leaving you at risk of losing it.
Don’t Count on State Exemptions
The new rules entail that a bankruptcy filer live in a sate for at least two years in order to gain from a state’s exemption laws otherwise they can only claim those exemptions of the previous state in which they lived. The same goes for homestead exemptions only this requires over 40 months of residency.
http://www.bestnichearticles.com/Article/Chapters-7-and-13-Bankruptcy-Laws/12279
Chapter 7 Bankruptcy Restrictions
The most common form of bankruptcy just got a little more exclusive. Under the old rules people could decide which chapter of bankruptcy was best for them- most choosing chapter 7. However, those with higher incomes must now be aware that they may not qualify to file for chapter 7 bankruptcy and will be forced to file under chapter 13. The gauge they use to decipher “high income families” is to compare your current monthly income with that of the median monthly income of a family of similar size in your state. Another factor to account for is how you current monthly income will be calculated. It is not what you are currently making at the time when you file for bankruptcy but rather an average of your income from the six months prior to making your claim. This poses a big problem for those who are filing bankruptcy after recently losing a job.
Restrictions on Lawyers
Among the new laws lawyers much personally vouch for the accuracy of the information provided. Thus, time spend on each bankruptcy case will increase, in turn driving up your lawyer bill.
Can You Live On Less?
Under the old rules, those who filed for chapter 13 did have to devote all disposable income to a payment plan. The new laws make this a little more challenging. In addition to handing over all disposable income, chapter 13 filers will have to calculate that amount from an expense amount allowed by the IRS- meaning they get to dictate what your living costs should be. Keeping in mind under chapter 13 you are still required to calculate disposable income according to an average of what you had made over the last six months.
Value Your Property at Replacement Cost
In the past heirlooms and other property that a debtor might want to keep were expected to be of little value- deeming them exempt. However, new laws force you to value all property at retail value taking into consideration age and condition- a requirement that, in most cases, will inflate the cost of your property leaving you at risk of losing it.
Don’t Count on State Exemptions
The new rules entail that a bankruptcy filer live in a sate for at least two years in order to gain from a state’s exemption laws otherwise they can only claim those exemptions of the previous state in which they lived. The same goes for homestead exemptions only this requires over 40 months of residency.
http://www.bestnichearticles.com/Article/Chapters-7-and-13-Bankruptcy-Laws/12279
Bankruptcy: Why the Different Chapters
Whether you hit a few to many “rainy days” in you past such as a job loss or a divorce, or you were simply a little too hap-hazard with credit cards in the past you may be in over your head and wondering which route to take to get out of the red and back on your feet. Between debt management, credit counseling, and the 13 dozen debt consolidation companies out there it can get really overwhelming really fast. Add the option of bankruptcy to the equation and even the most decisive and determined person will be thrown into overload. To ease the confusion, for those seriously considering a bankruptcy declaration, here are some factors to consider when looking into the different bankruptcy chapters.
Chapter 7 bankruptcy has always been the most common among individuals. When filing chapter 7 bankruptcy, as with all chapters, the declaration does stay on your credit report for ten years. During this time you will most likely only qualify for secured, high interest credit cards. Under chapter 7 you can expect all of your property to be liquidated except for some items which may fall into the “exempt” category including tools of one’s trade, a minimal amount of “personal effects”, and sometimes a small amount of home or car equity. Depending on which state you live in filing chapter 7 bankruptcy can often mean losing your home. Chapter 7 bankruptcy is also known as the “fresh start” as in most cases of chapter 7 the debtor is discharged of their liability.
Chapter 13 bankruptcy is often called “reorganizing” your debt. While in chapter 7 most of your property will be sold by your creditors to recuperate some of the cost of your debt, chapter 13 forces you to pay some or all of your debt, usually at better terms or. This type of bankruptcy is more of a form of rehabilitation though it does still appear on your credit report for ten years. Those with an income higher than the median income in your state may be forced to bypass chapter 7 and file for chapter 13 bankruptcy. During the “reorganization” phase, which generally last three the five years, you will be given an allowance by the IRS from your own paycheck. This allowance will have to cover housing, transportation, and some should be allocated to savings, while the rest of the your paycheck will go toward paying down your debt. In many cases a huge change in lifestyle is necessary to accommodate your assigned allowance.
Chapter 11 bankruptcy is more commonly a method reserved for businesses than individual consumers due to the complexity and high cost. Most often a business is still allowed to operate while in the process of filing though it will do so under close supervision. Chapter 11 bankruptcy gives businesses the opportunity to restructure and remove themselves from overly taxing contracts.
Hopefully a clear concise understanding of each bankruptcy chapter will help to put everything in perspective to help guide you on your way to recovery. Filing for bankruptcy, regardless of whether it is chapter 7, 11, or 13, is a huge undertaking. But rest assured, once the papers are signed it’s all about the recovery and in the end it may be the best thing you’ve ever done for yourself and your family.
http://www.bestnichearticles.com/Article/Bankruptcy--Why-the-Different-Chapters/12302
Chapter 7 bankruptcy has always been the most common among individuals. When filing chapter 7 bankruptcy, as with all chapters, the declaration does stay on your credit report for ten years. During this time you will most likely only qualify for secured, high interest credit cards. Under chapter 7 you can expect all of your property to be liquidated except for some items which may fall into the “exempt” category including tools of one’s trade, a minimal amount of “personal effects”, and sometimes a small amount of home or car equity. Depending on which state you live in filing chapter 7 bankruptcy can often mean losing your home. Chapter 7 bankruptcy is also known as the “fresh start” as in most cases of chapter 7 the debtor is discharged of their liability.
Chapter 13 bankruptcy is often called “reorganizing” your debt. While in chapter 7 most of your property will be sold by your creditors to recuperate some of the cost of your debt, chapter 13 forces you to pay some or all of your debt, usually at better terms or. This type of bankruptcy is more of a form of rehabilitation though it does still appear on your credit report for ten years. Those with an income higher than the median income in your state may be forced to bypass chapter 7 and file for chapter 13 bankruptcy. During the “reorganization” phase, which generally last three the five years, you will be given an allowance by the IRS from your own paycheck. This allowance will have to cover housing, transportation, and some should be allocated to savings, while the rest of the your paycheck will go toward paying down your debt. In many cases a huge change in lifestyle is necessary to accommodate your assigned allowance.
Chapter 11 bankruptcy is more commonly a method reserved for businesses than individual consumers due to the complexity and high cost. Most often a business is still allowed to operate while in the process of filing though it will do so under close supervision. Chapter 11 bankruptcy gives businesses the opportunity to restructure and remove themselves from overly taxing contracts.
Hopefully a clear concise understanding of each bankruptcy chapter will help to put everything in perspective to help guide you on your way to recovery. Filing for bankruptcy, regardless of whether it is chapter 7, 11, or 13, is a huge undertaking. But rest assured, once the papers are signed it’s all about the recovery and in the end it may be the best thing you’ve ever done for yourself and your family.
http://www.bestnichearticles.com/Article/Bankruptcy--Why-the-Different-Chapters/12302
You're Suing ME?! Adding Insult to Injury to Creditors of Bankrupt Debtors
In the course of managing a bankruptcy-centered law practice, one notices that certain themes tend to recur. One of the things that seems, repeatedly and quite understandably, to make the blood of credit managers in bankruptcy cases boil, is the prospect of being sued for a 'preference' while they are already stuck with a bad account receivable. This seems to many vendors to be the ultimate outrage. Having shipped goods, or rendered services on credit, in good faith, and in the expectation of being paid, and then, having already been burned (often for substantial sums) by the bankruptcy filing itself, they may find themselves pursued by a trustee or other estate representative, to give back the smaller amount they received on account of their claim within the 90-day period preceding the bankruptcy filing.
After 25-odd years of minor tinkering with the preference laws as drafted in the Bankruptcy Code, which came into effect in 1979, Congress has, for the first time, and in response to intense lobbying by creditor-based interest groups, made significant, and wide-ranging changes which will, in the view of this author, work a sea change in this area.
First of all, we need to understand what a preferential payment is, and why the bankruptcy laws allow for their recovery, before exploring, in very broad strokes, for purposes of this article, how and why the recent amendments to the Bankruptcy Code have helped 'level the playing field.'
The purpose of making preferential payments recoverable is to promote equality (or, more accurately, "equitable-ness") of distribution among creditors. In other words, the pain should be shared on a reasonably equitable basis by those who are on the receiving end of bad receivables. To that end, certain payments made by troubled debtors, during the 90-day window preceding the bankruptcy filing are subject to being brought back into the estate for redistribution, on an equitable basis, to the creditor body at large. There are a number of other technical requirements for a payment to be preferential, but these are beyond the scope of this article, and creditors are encouraged to seek appropriate legal counsel as needed.
On the surface, this seems reasonably fair. After all, why should creditors who have a closer relationship with the bankrupt company, or who just scream louder, be paid while the other guy gets left holding the bag. But, alas, here's the dirty little secret of preference claims. For the most part, though not exclusively, they are pursued, by trustees in liquidation cases, in which there will ultimately be little or no recovery for unsecured creditors. So who gets the money recovered in these preference litigations? Why, the trustees, their lawyers and accountants, of course, whose rights to payment come before everyone else. So rather than being a vehicle for equitable redistribution of limited funds of an insolvent debtor, the preference statute has been used as a tool for trustees and their professionals to build an estate as a source of trustee fees, and legal and accounting fees. In most such cases, the creditors end up with nothing at all, except the privilege of paying twice.
On the other hand, the drafters of prior legislation wanted to encourage vendors to continue selling goods to troubled companies so as not to exacerbate an already difficult situation and bring on unnecessary or premature bankruptcies. So various defenses to preference claims were introduced, to exempt certain payments made contemporaneously, or in the ordinary course of business and within invoice terms, from preference attack. These concepts, however, still left the burden on the creditor/defendant to prove these defenses, and they often found that it was easier and cheaper just to 'pay up' or settle the claims, however distasteful it seemed to them
So what has the new bankruptcy law done for these creditors? Well, it has, among other significant changes, substantially tightened up the 'ordinary course' defense, making it substantially easier for creditors to establish them, by creating both a 'subjective' and an 'objective test' (again, the details of this are too technical for the scope of this article). Perhaps even more importantly, Congress has now exempted smaller payments from the reach of preference attack and changed venue provisions for others, thus requiring trustees or other estate representatives to sue where the preference recipient is located, rather than in the 'home' bankruptcy court. Previously, the daunting prospect of defending on the other side of the country might well induce a creditor to settle a case even of dubious merit because of the expense involved of travel and the hiring of local counsel in a far-off district. Now, in many cases, the economics of this situation have been turned on their heads, and it might well be the trustee who will have to think twice, or three times, about bringing 'nuisance' preference cases when they have to be prosecuted in foreign jurisdictions.
Thus, although this legislation is very new, and largely untested, it seems that creditors in bankruptcy cases will, at least from their viewpoint, be getting a fairer shake, and will less often be having insult added to injury by having to enlarge the size of their already uncollectible receivables.
http://www.bestnichearticles.com/Article/You-re-Suing-ME---Adding-Insult-to-Injury-to-Creditors-of-Bankrupt-Debtors/14067
After 25-odd years of minor tinkering with the preference laws as drafted in the Bankruptcy Code, which came into effect in 1979, Congress has, for the first time, and in response to intense lobbying by creditor-based interest groups, made significant, and wide-ranging changes which will, in the view of this author, work a sea change in this area.
First of all, we need to understand what a preferential payment is, and why the bankruptcy laws allow for their recovery, before exploring, in very broad strokes, for purposes of this article, how and why the recent amendments to the Bankruptcy Code have helped 'level the playing field.'
The purpose of making preferential payments recoverable is to promote equality (or, more accurately, "equitable-ness") of distribution among creditors. In other words, the pain should be shared on a reasonably equitable basis by those who are on the receiving end of bad receivables. To that end, certain payments made by troubled debtors, during the 90-day window preceding the bankruptcy filing are subject to being brought back into the estate for redistribution, on an equitable basis, to the creditor body at large. There are a number of other technical requirements for a payment to be preferential, but these are beyond the scope of this article, and creditors are encouraged to seek appropriate legal counsel as needed.
On the surface, this seems reasonably fair. After all, why should creditors who have a closer relationship with the bankrupt company, or who just scream louder, be paid while the other guy gets left holding the bag. But, alas, here's the dirty little secret of preference claims. For the most part, though not exclusively, they are pursued, by trustees in liquidation cases, in which there will ultimately be little or no recovery for unsecured creditors. So who gets the money recovered in these preference litigations? Why, the trustees, their lawyers and accountants, of course, whose rights to payment come before everyone else. So rather than being a vehicle for equitable redistribution of limited funds of an insolvent debtor, the preference statute has been used as a tool for trustees and their professionals to build an estate as a source of trustee fees, and legal and accounting fees. In most such cases, the creditors end up with nothing at all, except the privilege of paying twice.
On the other hand, the drafters of prior legislation wanted to encourage vendors to continue selling goods to troubled companies so as not to exacerbate an already difficult situation and bring on unnecessary or premature bankruptcies. So various defenses to preference claims were introduced, to exempt certain payments made contemporaneously, or in the ordinary course of business and within invoice terms, from preference attack. These concepts, however, still left the burden on the creditor/defendant to prove these defenses, and they often found that it was easier and cheaper just to 'pay up' or settle the claims, however distasteful it seemed to them
So what has the new bankruptcy law done for these creditors? Well, it has, among other significant changes, substantially tightened up the 'ordinary course' defense, making it substantially easier for creditors to establish them, by creating both a 'subjective' and an 'objective test' (again, the details of this are too technical for the scope of this article). Perhaps even more importantly, Congress has now exempted smaller payments from the reach of preference attack and changed venue provisions for others, thus requiring trustees or other estate representatives to sue where the preference recipient is located, rather than in the 'home' bankruptcy court. Previously, the daunting prospect of defending on the other side of the country might well induce a creditor to settle a case even of dubious merit because of the expense involved of travel and the hiring of local counsel in a far-off district. Now, in many cases, the economics of this situation have been turned on their heads, and it might well be the trustee who will have to think twice, or three times, about bringing 'nuisance' preference cases when they have to be prosecuted in foreign jurisdictions.
Thus, although this legislation is very new, and largely untested, it seems that creditors in bankruptcy cases will, at least from their viewpoint, be getting a fairer shake, and will less often be having insult added to injury by having to enlarge the size of their already uncollectible receivables.
http://www.bestnichearticles.com/Article/You-re-Suing-ME---Adding-Insult-to-Injury-to-Creditors-of-Bankrupt-Debtors/14067
Tuesday, July 17, 2007
How To Find The Right Bankruptcy Lawyer
I am going to assume that you are seeking a bankruptcy lawyer because you have already exhausted all other possibilities to avoid filing bankruptcy. If you have not yet done that, I would strongly encourage you to thoroughly investigate all other options and alternatives, since bankruptcy should be considered only as your very last resort. A filing of bankruptcy will remain on your credit report for 7 to 10 years, and it will be a major red flag any time you apply for credit or a loan in the future, as well as having the possibility of you not getting a new job based on a credit report run on you.
It is not entirely necessary to hire a lawyer or attorney when filing for bankruptcy, but in the vast majority of cases, it is highly advisable to do so. The various legal forms and requirements can be a full time job for someone who is not intimately familiar with the legal system, and one wrong move can mean the difference between favorable terms, or perhaps even terms that put you in a worse situation than you are now.
Even with all bankruptcy lawyers combined, not all bankruptcy attorneys specialize in the same type of cases, so you need to make sure that you are finding a lawyer who is very familiar with the type of financial difficulties that you are facing. Unfortunately, this is not nearly as easy as walking through the yellow pages and browsing page after page of lawyer listings. Our web site contains a form where you can identify your specific situation and then be referred to a bankruptcy lawyer who is both LOCAL to you, as well as being familiar with your particular type of situation and circumstances.
When you meet with the bankruptcy lawyer, you want to maximize both your time and his time, so make sure you bring all pertinent information with you. Bring a list of all creditors, your required monthly payment to each, the current outstanding balance of each, the account numbers, and the status of each debt in terms of being current, 30 days past due, 60 days past due, etc. Also provide information on which creditors you have spoken with, as well as any particular arrangements you may have already made with any of these creditors.
Your bankruptcy lawyer can prevent creditors from harassing you, and this can start immediately after you have retained his services. With all the stress of this type of financial situation, the constant telephone calls from creditors, with each call being more threatening or sinister than the previous one, can add a huge amount of additional stress that you just do not need right now in your situation.
Your bankruptcy lawyer will be familiar with the new laws that affect bankruptcy filings. It is not nearly as easy to file bankruptcy today as it was only a few short years ago. In some situations, you may be required to go through credit counseling before being allowed to file bankruptcy. In fact, after becoming familiar with your specific situation, your lawyer may recommend other options or alternatives instead of bankruptcy, perhaps options that you had not previously considered.
In summary, be aware that just because someone has passed the bar exam does not mean that they are able to be a competent bankruptcy attorney. Be sure to find one who specializes in your particular type of bankruptcy to obtain your best bet of resoling this situation as easily and with as less pain as possible.
http://www.bestnichearticles.com/Article/How-To-Find-The-Right-Bankruptcy-Lawyer/69241
It is not entirely necessary to hire a lawyer or attorney when filing for bankruptcy, but in the vast majority of cases, it is highly advisable to do so. The various legal forms and requirements can be a full time job for someone who is not intimately familiar with the legal system, and one wrong move can mean the difference between favorable terms, or perhaps even terms that put you in a worse situation than you are now.
Even with all bankruptcy lawyers combined, not all bankruptcy attorneys specialize in the same type of cases, so you need to make sure that you are finding a lawyer who is very familiar with the type of financial difficulties that you are facing. Unfortunately, this is not nearly as easy as walking through the yellow pages and browsing page after page of lawyer listings. Our web site contains a form where you can identify your specific situation and then be referred to a bankruptcy lawyer who is both LOCAL to you, as well as being familiar with your particular type of situation and circumstances.
When you meet with the bankruptcy lawyer, you want to maximize both your time and his time, so make sure you bring all pertinent information with you. Bring a list of all creditors, your required monthly payment to each, the current outstanding balance of each, the account numbers, and the status of each debt in terms of being current, 30 days past due, 60 days past due, etc. Also provide information on which creditors you have spoken with, as well as any particular arrangements you may have already made with any of these creditors.
Your bankruptcy lawyer can prevent creditors from harassing you, and this can start immediately after you have retained his services. With all the stress of this type of financial situation, the constant telephone calls from creditors, with each call being more threatening or sinister than the previous one, can add a huge amount of additional stress that you just do not need right now in your situation.
Your bankruptcy lawyer will be familiar with the new laws that affect bankruptcy filings. It is not nearly as easy to file bankruptcy today as it was only a few short years ago. In some situations, you may be required to go through credit counseling before being allowed to file bankruptcy. In fact, after becoming familiar with your specific situation, your lawyer may recommend other options or alternatives instead of bankruptcy, perhaps options that you had not previously considered.
In summary, be aware that just because someone has passed the bar exam does not mean that they are able to be a competent bankruptcy attorney. Be sure to find one who specializes in your particular type of bankruptcy to obtain your best bet of resoling this situation as easily and with as less pain as possible.
http://www.bestnichearticles.com/Article/How-To-Find-The-Right-Bankruptcy-Lawyer/69241
7 Steps to a Fresh Start after Bankruptcy
Bankruptcy is one option to consider in order giving yourself a “fresh start,” when you have more debts than you have assets. There are in fact many types of bankruptcy provided under the law but the most common is Chapter 7 bankruptcy, which is also known as liquidation.
When filing under Chapter 7 bankruptcy, all your assets, excluding those that are exempt under the law of your state, are dissolved and liquidated. Generally, the person tasked to do this is the court-appointed official, called a trustee.
All in all, the vital task of the trustee is selling your properties and using the proceeds to pay your creditors. After doing such, the court will then cancel many of your remaining debts, thus affording you a “fresh start” to life.
Here is a step-by-step guide to filing a bankruptcy under Chapter 7 bankruptcy:
Step 1: Decide whether you should file bankruptcy or not.
Filing bankruptcy is a personal decision, influenced by many factors, such as the amount of serious debts and your ability to meet the original payments or pay the full amount. For starters, when you are broke, it is never a nice experience getting harassed by creditors for debts incurred. For another, your decision to file should not be made for the sole purpose of putting a stop to your demanding creditors.
This is a significant point as secured creditors may apply for “relief from stay,” thus allowing them to continue their efforts to repossess or foreclose even though you already filed for bankruptcy.
Step 2: Get an attorney
While the law on Chapter 7 bankruptcy does not need individual consumers to hire an attorney who would represent them in court, it is still advisable to ask for legal help, particularly concerning critical decisions involved in bankruptcy.
Step 3: Comply with the legal requirements.
File your petition with the bankruptcy court serving in your area. If you are a business debtor, then file with the bankruptcy court in the place where the business was organized or has its principal place of business or principal assets. Your attorney should be able to advise you on how to deal with these required legal forms.
Step 4: Pay the necessary fees.
As with any other court cases, there are certain fees required, such as:
• Case filing fee
• Miscellaneous administrative fee
• Trustee surcharge
Upon filing, you are usually asked to pay these fees to the clerk of court.
Note that the number of installments is limited only to four. Additionally to that, you are also required to make the final installment no later than 120 days after filing the petition.
Step 5: Notice to the creditors and meeting.
After filing your petition for bankruptcy under Chapter 7, paying the necessary fees, and complying with the legal requirements, an “automatic stay” is granted to you by operation of law. This stay will efficiently stop most collection actions against you and your properties. This means that as long as the stay is in effect, creditors cannot initiate or continue lawsuits, wage garnishments, or even telephone calls demanding payments.
After the bankruptcy case has been filed, the bankruptcy clerk will give notice to all creditors whose names and addresses you provided. Then, the case trustee will hold a meeting of creditors between 20 and 40 days after you filed your petition.
Step 6: Cooperate with the trustee.
The case trustee has a vital role in a bankruptcy case. His primary responsibility is to liquidate your nonexempt assets in a manner that maximizes the return to your unsecured creditors. He does this by selling your property, if it is free and clear of liens and as long as it is not exempt, or if it worth more than any security interest or lien attached to the property and any exemption that the debtor holds in the property.
In view of the broadness of a trustee’s power, it is significant therefore that you cooperate with the trustee. Provide any financial records or documents that the trustee requests and answer questions, which the trustee is necessary to ask at the meeting of creditors under the Bankruptcy Code.
Step 7: After the discharge…
If all goes well with your Chapter 7 bankruptcy case – that is, no one files a complaint objecting to the discharge or a motion to extend the time to object – the bankruptcy court will issue a discharge order relatively early in the case, about 60 to 90 days after the date first set for the meeting of creditors
A discharge order is an order issued by the bankruptcy court, releasing you from personal liability for most debts and preventing your creditors from taking any collection actions against you. As a rule, excluding cases that are dismissed or converted, individual debtors receive a discharge in more than 99 percent of Chapter 7 bankruptcy cases.
For someone filing under Chapter 7 bankruptcy, a discharge of almost all of your debts is the ultimate goal. With the release of all your debts and creditors stopped from pursuing
http://www.bestnichearticles.com/Article/7-Steps-to-a-Fresh-Start-after-Bankruptcy/69543
When filing under Chapter 7 bankruptcy, all your assets, excluding those that are exempt under the law of your state, are dissolved and liquidated. Generally, the person tasked to do this is the court-appointed official, called a trustee.
All in all, the vital task of the trustee is selling your properties and using the proceeds to pay your creditors. After doing such, the court will then cancel many of your remaining debts, thus affording you a “fresh start” to life.
Here is a step-by-step guide to filing a bankruptcy under Chapter 7 bankruptcy:
Step 1: Decide whether you should file bankruptcy or not.
Filing bankruptcy is a personal decision, influenced by many factors, such as the amount of serious debts and your ability to meet the original payments or pay the full amount. For starters, when you are broke, it is never a nice experience getting harassed by creditors for debts incurred. For another, your decision to file should not be made for the sole purpose of putting a stop to your demanding creditors.
This is a significant point as secured creditors may apply for “relief from stay,” thus allowing them to continue their efforts to repossess or foreclose even though you already filed for bankruptcy.
Step 2: Get an attorney
While the law on Chapter 7 bankruptcy does not need individual consumers to hire an attorney who would represent them in court, it is still advisable to ask for legal help, particularly concerning critical decisions involved in bankruptcy.
Step 3: Comply with the legal requirements.
File your petition with the bankruptcy court serving in your area. If you are a business debtor, then file with the bankruptcy court in the place where the business was organized or has its principal place of business or principal assets. Your attorney should be able to advise you on how to deal with these required legal forms.
Step 4: Pay the necessary fees.
As with any other court cases, there are certain fees required, such as:
• Case filing fee
• Miscellaneous administrative fee
• Trustee surcharge
Upon filing, you are usually asked to pay these fees to the clerk of court.
Note that the number of installments is limited only to four. Additionally to that, you are also required to make the final installment no later than 120 days after filing the petition.
Step 5: Notice to the creditors and meeting.
After filing your petition for bankruptcy under Chapter 7, paying the necessary fees, and complying with the legal requirements, an “automatic stay” is granted to you by operation of law. This stay will efficiently stop most collection actions against you and your properties. This means that as long as the stay is in effect, creditors cannot initiate or continue lawsuits, wage garnishments, or even telephone calls demanding payments.
After the bankruptcy case has been filed, the bankruptcy clerk will give notice to all creditors whose names and addresses you provided. Then, the case trustee will hold a meeting of creditors between 20 and 40 days after you filed your petition.
Step 6: Cooperate with the trustee.
The case trustee has a vital role in a bankruptcy case. His primary responsibility is to liquidate your nonexempt assets in a manner that maximizes the return to your unsecured creditors. He does this by selling your property, if it is free and clear of liens and as long as it is not exempt, or if it worth more than any security interest or lien attached to the property and any exemption that the debtor holds in the property.
In view of the broadness of a trustee’s power, it is significant therefore that you cooperate with the trustee. Provide any financial records or documents that the trustee requests and answer questions, which the trustee is necessary to ask at the meeting of creditors under the Bankruptcy Code.
Step 7: After the discharge…
If all goes well with your Chapter 7 bankruptcy case – that is, no one files a complaint objecting to the discharge or a motion to extend the time to object – the bankruptcy court will issue a discharge order relatively early in the case, about 60 to 90 days after the date first set for the meeting of creditors
A discharge order is an order issued by the bankruptcy court, releasing you from personal liability for most debts and preventing your creditors from taking any collection actions against you. As a rule, excluding cases that are dismissed or converted, individual debtors receive a discharge in more than 99 percent of Chapter 7 bankruptcy cases.
For someone filing under Chapter 7 bankruptcy, a discharge of almost all of your debts is the ultimate goal. With the release of all your debts and creditors stopped from pursuing
http://www.bestnichearticles.com/Article/7-Steps-to-a-Fresh-Start-after-Bankruptcy/69543
Finding Cheap Bankruptcy Lawyers For You
In this age of living on credit cards it is not surprising to find that more and more people are filing for bankruptcy. In order to prevent the misuse of bankruptcy claim a new law called the Bankruptcy Abuse and Consumer Protection Act, was passed in 2005. If you are in a serious and genuine financial problem, the right thing to do is file for bankruptcy. But before you do that you would have to find yourself a cheap bankruptcy lawyer who can explain to you all the finer points of the new law and can get you a good deal.
Where to Find a Bankruptcy Lawyer
Your quest for finding cheap bankruptcy lawyers can start with your family and friends. Those who have gone through the bankruptcy experience can recommend some names. You will get an insight into how competent the lawyer is. If you know an attorney, he or she might be able to refer you to some good bankruptcy lawyer.
Bankruptcy is a complex legal process, therefore, it is essential to have a bankruptcy lawyer who can put forward legal methods to either wipe out the debt by liquidating your assets and distributing them amongst your creditors, or develop a repayment plan. Usually the first consultation with a bankruptcy lawyer is free, so make sure you put forward your real financial situation before him or her. Once you have hired a bankruptcy lawyer, provide him or her with a list of all the debts that you carry. This would include credit cards, medical bills, loans, cars, etc. Make sure you have your bankruptcy lawyer explain to you all the details of the new law. If you have any questions, do not hesitate to ask.
Choosing a Good Bankruptcy Lawyer
A good bankruptcy lawyer will give you expert advice on how to get your financial situation back on track. A good lawyer will help you with repayment plans and debt management. Before you finalize your choice make sure you share a comfort level with your bankruptcy lawyer.
You want a lawyer who understands the system and will do a good job to represent you. It may cost you a little more but you get what you pay for. Your local bar association can probably help you decide whether a proposed fee is fair with the local standard. You can also browse online to compare some services to get an idea how much it would cost you to hire a bankruptcy lawyer.
http://www.bestnichearticles.com/Article/Finding-Cheap-Bankruptcy-Lawyers-For-You/70169
Where to Find a Bankruptcy Lawyer
Your quest for finding cheap bankruptcy lawyers can start with your family and friends. Those who have gone through the bankruptcy experience can recommend some names. You will get an insight into how competent the lawyer is. If you know an attorney, he or she might be able to refer you to some good bankruptcy lawyer.
Bankruptcy is a complex legal process, therefore, it is essential to have a bankruptcy lawyer who can put forward legal methods to either wipe out the debt by liquidating your assets and distributing them amongst your creditors, or develop a repayment plan. Usually the first consultation with a bankruptcy lawyer is free, so make sure you put forward your real financial situation before him or her. Once you have hired a bankruptcy lawyer, provide him or her with a list of all the debts that you carry. This would include credit cards, medical bills, loans, cars, etc. Make sure you have your bankruptcy lawyer explain to you all the details of the new law. If you have any questions, do not hesitate to ask.
Choosing a Good Bankruptcy Lawyer
A good bankruptcy lawyer will give you expert advice on how to get your financial situation back on track. A good lawyer will help you with repayment plans and debt management. Before you finalize your choice make sure you share a comfort level with your bankruptcy lawyer.
You want a lawyer who understands the system and will do a good job to represent you. It may cost you a little more but you get what you pay for. Your local bar association can probably help you decide whether a proposed fee is fair with the local standard. You can also browse online to compare some services to get an idea how much it would cost you to hire a bankruptcy lawyer.
http://www.bestnichearticles.com/Article/Finding-Cheap-Bankruptcy-Lawyers-For-You/70169
First Steps To Understanding The Bankruptcy Code
Becoming bankrupt is not something that many people think about. There are occasions when this will happen and these individuals will need to file for bankruptcy. The assorted chapters of bankruptcy like chapter 13, and chapter 11 are taken from the bankruptcy code. This code was established by the US congress.
Believe it or not, much of these laws are in place to protect the individuals who are having financial problems. Below we will outline what the bankruptcy codes are and what they mean to you.
These laws were put in place so that there was a uniform law about bankruptcy that could be found throughout the US. These laws from the bankruptcy code are designed to protect the person who is in debt from further problems.
There are currently four main types of bankruptcy laws that are taken from the bankruptcy code. You will recognize these bankruptcy laws as chapters. Chapter 11 is one of the bankruptcy laws that can be found in the bankruptcy code under the heading chapter 11.
The different chapters inside the bankruptcy code provide info for people who are in debt. The various ways that the law can work to keep you safe from unreasonable hassles can be found inside the pages of the bankruptcy code chapters.
As a citizen you have the right to view and read these laws. The only problem that we see is it is typically to late for most people. Meaning they are already in financial trouble, so reading about the laws to stop the bankruptcy may not work. However, you will still want to understand the rights you have being in a bankrupt state of affairs.
While the US government has provided the framework for these laws of the bankruptcy code each state has the right to pass other laws that will work in accordance with the bankruptcy code. They don't have the right to change the law, just factors that pertain to their specific state can they add.
The states can only provide other laws that are compatible with their state's laws. Otherwise the states themselves don't have the power to govern how the bankruptcy code works.
There are many dissimilar and new laws that you can find when you look through the bankruptcy code. One of the new laws that you will find is the altered state of the debtor-creditor relationship.
While the different states can't vary the basic rules of the bankruptcy code they do have the right to interpret how these bankruptcy claims are filed and acted on in their respective states.
If there is a major change to the bankruptcy code this change will be passed by congress. One such change that has taken effect alters the rules of bankruptcy for chapter 7. In this part of the bankruptcy code all debtors must prove that they have the right to file for bankruptcy.
The bankruptcy was established and put into place to address those that are in financial trouble and for creditors to get their money back. This of course if a very general definition, but will serve the point. So be responsible and spend less than you make.
They will be allowed to file for bankruptcy only if these people have fulfilled a counseling session. This step has been taken to hold that the bankruptcy code is not being misused by the assorted individuals who want to avoid paying their various debts. As the bankruptcy code has been placed for our shelter it is best if you handle these laws with respect.
http://www.bestnichearticles.com/Article/First-Steps-To-Understanding-The-Bankruptcy-Code/70125
Believe it or not, much of these laws are in place to protect the individuals who are having financial problems. Below we will outline what the bankruptcy codes are and what they mean to you.
These laws were put in place so that there was a uniform law about bankruptcy that could be found throughout the US. These laws from the bankruptcy code are designed to protect the person who is in debt from further problems.
There are currently four main types of bankruptcy laws that are taken from the bankruptcy code. You will recognize these bankruptcy laws as chapters. Chapter 11 is one of the bankruptcy laws that can be found in the bankruptcy code under the heading chapter 11.
The different chapters inside the bankruptcy code provide info for people who are in debt. The various ways that the law can work to keep you safe from unreasonable hassles can be found inside the pages of the bankruptcy code chapters.
As a citizen you have the right to view and read these laws. The only problem that we see is it is typically to late for most people. Meaning they are already in financial trouble, so reading about the laws to stop the bankruptcy may not work. However, you will still want to understand the rights you have being in a bankrupt state of affairs.
While the US government has provided the framework for these laws of the bankruptcy code each state has the right to pass other laws that will work in accordance with the bankruptcy code. They don't have the right to change the law, just factors that pertain to their specific state can they add.
The states can only provide other laws that are compatible with their state's laws. Otherwise the states themselves don't have the power to govern how the bankruptcy code works.
There are many dissimilar and new laws that you can find when you look through the bankruptcy code. One of the new laws that you will find is the altered state of the debtor-creditor relationship.
While the different states can't vary the basic rules of the bankruptcy code they do have the right to interpret how these bankruptcy claims are filed and acted on in their respective states.
If there is a major change to the bankruptcy code this change will be passed by congress. One such change that has taken effect alters the rules of bankruptcy for chapter 7. In this part of the bankruptcy code all debtors must prove that they have the right to file for bankruptcy.
The bankruptcy was established and put into place to address those that are in financial trouble and for creditors to get their money back. This of course if a very general definition, but will serve the point. So be responsible and spend less than you make.
They will be allowed to file for bankruptcy only if these people have fulfilled a counseling session. This step has been taken to hold that the bankruptcy code is not being misused by the assorted individuals who want to avoid paying their various debts. As the bankruptcy code has been placed for our shelter it is best if you handle these laws with respect.
http://www.bestnichearticles.com/Article/First-Steps-To-Understanding-The-Bankruptcy-Code/70125
Monday, July 16, 2007
Five Steps on How to Find and Choose A Bankruptcy Attorney
If you are like many men and women in the 21st century, you may have found yourself literally drowning in debt. As a result, you may have made the touch decision to file for bankruptcy. In this regard, you may be wondering what steps that you need to take to determine how to find and choose a bankruptcy attorney. Indeed, there are some specific steps you need to take in order to determine how to find and choose an appropriate attorney.
1. The first step in how to find and choose a bankruptcy attorney is to contact the local bar association in your community. While your local bar association will not make any specific recommendations about a particular lawyer, your local bar association will provide you with a list of lawyers in your community that specialize specifically in the practice of bankruptcy law. Because bankruptcy is such a specialized area of the law, it is vital that you obtain a lawyer that is specifically trained and experienced in the practice of bankruptcy law. Additionally, there are lawyers that specialize in consumer bankruptcy law and commercial or business bankruptcy law. Depending on what type of bankruptcy case you will be filing -- consumer or personal, commercial or business -- will depend on what type of lawyer you actually will want to retain. (There are also lawyers who specialize in agricultural bankruptcies. Agriculture bankruptcies are also specialized and require the assistance of specifically trained attorneys.)
2. The second step in how to find a bankruptcy attorney is to listen to what your friends, family members and colleagues have to say about one attorney or another. In this high-tech age, many people overlook the benefits of word of mouth. In the final analysis, some of the best information that you can obtain about a lawyer even in this age of high-tech communications is through word of mouth. Chances are very good that you know a friend, family member or colleague who has had to go through a bankruptcy. Find out what that person or those persons have to say about the lawyer or lawyers that they have used for their own bankruptcy cases.
3. The third step in how to find a bankruptcy attorney involves doing an Internet search about the specific lawyers that you have on your list of potential attorneys to assist you in your own bankruptcy case. Oftentimes on the Net, you will be able to find newspaper articles, bar association notices and other information about lawyers. By reviewing this information, you will be able to develop a clearer picture about the business and background of particular bankruptcy lawyers that you are considering employing.
4. As you continue to narrow down your list of attorneys, you will reach the step at which you will want to arrange face to face meetings with a few of the “finalists” on your list of potential lawyers. In so many ways, there is nothing more important than meeting with a lawyer face to face before you engage that attorney. You can sum up a lawyer easier when you are able to see and hear them in person.
5. The final step in how to find and choose a bankruptcy attorney involves making the decision to go with a particular lawyer. At this juncture, you will want your new lawyer to provide you with a specific contract that lays out what your lawyer will do for you, what services he or she will provide. In addition, you will want to make certain that the lawyer specifically lays out what he or she will be charging you in the way of fees and how those fees will be paid by you. (In most instances, the fees that are assessed to you by your lawyer must be approved by the bankruptcy court. Therefore, in many instances, you will not pay attorney fees relating to a bankruptcy case up front.)
By following these steps to how to find and choose a bankruptcy attorney, you will be in the best possible position to choose and select a bankruptcy lawyer that will best meet your particular needs. As a result, you will have the best possible chance to truly bring order to your chaotic financial house both in the short and the long term.
http://www.bestnichearticles.com/Article/Five-Steps-on-How-to-Find-and-Choose-A-Bankruptcy-Attorney/6962
1. The first step in how to find and choose a bankruptcy attorney is to contact the local bar association in your community. While your local bar association will not make any specific recommendations about a particular lawyer, your local bar association will provide you with a list of lawyers in your community that specialize specifically in the practice of bankruptcy law. Because bankruptcy is such a specialized area of the law, it is vital that you obtain a lawyer that is specifically trained and experienced in the practice of bankruptcy law. Additionally, there are lawyers that specialize in consumer bankruptcy law and commercial or business bankruptcy law. Depending on what type of bankruptcy case you will be filing -- consumer or personal, commercial or business -- will depend on what type of lawyer you actually will want to retain. (There are also lawyers who specialize in agricultural bankruptcies. Agriculture bankruptcies are also specialized and require the assistance of specifically trained attorneys.)
2. The second step in how to find a bankruptcy attorney is to listen to what your friends, family members and colleagues have to say about one attorney or another. In this high-tech age, many people overlook the benefits of word of mouth. In the final analysis, some of the best information that you can obtain about a lawyer even in this age of high-tech communications is through word of mouth. Chances are very good that you know a friend, family member or colleague who has had to go through a bankruptcy. Find out what that person or those persons have to say about the lawyer or lawyers that they have used for their own bankruptcy cases.
3. The third step in how to find a bankruptcy attorney involves doing an Internet search about the specific lawyers that you have on your list of potential attorneys to assist you in your own bankruptcy case. Oftentimes on the Net, you will be able to find newspaper articles, bar association notices and other information about lawyers. By reviewing this information, you will be able to develop a clearer picture about the business and background of particular bankruptcy lawyers that you are considering employing.
4. As you continue to narrow down your list of attorneys, you will reach the step at which you will want to arrange face to face meetings with a few of the “finalists” on your list of potential lawyers. In so many ways, there is nothing more important than meeting with a lawyer face to face before you engage that attorney. You can sum up a lawyer easier when you are able to see and hear them in person.
5. The final step in how to find and choose a bankruptcy attorney involves making the decision to go with a particular lawyer. At this juncture, you will want your new lawyer to provide you with a specific contract that lays out what your lawyer will do for you, what services he or she will provide. In addition, you will want to make certain that the lawyer specifically lays out what he or she will be charging you in the way of fees and how those fees will be paid by you. (In most instances, the fees that are assessed to you by your lawyer must be approved by the bankruptcy court. Therefore, in many instances, you will not pay attorney fees relating to a bankruptcy case up front.)
By following these steps to how to find and choose a bankruptcy attorney, you will be in the best possible position to choose and select a bankruptcy lawyer that will best meet your particular needs. As a result, you will have the best possible chance to truly bring order to your chaotic financial house both in the short and the long term.
http://www.bestnichearticles.com/Article/Five-Steps-on-How-to-Find-and-Choose-A-Bankruptcy-Attorney/6962
Seven Steps on How to File for Bankruptcy
In the 21st century, many men and women find themselves struggling to keep their heads above water financially. With ever mounting debt, these people oftentimes need to seek relief by filing for bankruptcy. Perhaps you are such a person who is fighting to make ends meet. As a result, you may be wondering how to file for bankruptcy.
The first step in learning how to file for bankruptcy is to make a comprehensive list of all of your creditors and outstanding debts. When you are working to determine how to file for bankruptcy, you need to appreciate that if you to proceed with a bankruptcy case, you must be sure that all of your debts are disclosed and listed in a bankruptcy petition.
The next step in filing for bankruptcy is to determine exactly what assets you have available to you. Your assets include your recurring income from your job, your home and major items of personal property that you might own (including such items as motor vehicles).
The third step you need to undertake when it comes to seeking bankruptcy relief is to contact all three major credit bureaus. When all is said and done, the three major credit bureaus may have the best record of all of your outstanding debt. By obtaining your credit reports from the three major credit bureaus, you will be able to cross reference your list of debt to make certain that you have all accounts covered and listed.
The forth factor that needs to be considered on the road to filing for bankruptcy, is to determine whether you will seek professional assistance in the pursuit of a bankruptcy case. Some people do elect to file for bankruptcy on their own without the aid and assistance of a lawyer. However, in most instances, it probably is in your best interest to seek the professional assistance of a lawyer in order to properly pursue a bankruptcy case. Therefore, unless you have a very simple bankruptcy on the horizon and unless you actually have some definite, practical legal experience, you should seek out the assistance of a lawyer to aid you in pursuing your case.
In working towards fully understanding how to file for bankruptcy, if you do make the decision to hire a lawyer, you will need to begin an organized search to find the best attorney to meet your needs. Keep in mind that in this day and age there are lawyers that specialize specifically in the area of consumer bankruptcies. As a result, you most likely will want to narrow your search to those specific attorneys who do have experience in dealing with bankruptcy cases. In the long run, you will be best served by engaging the services of a lawyer who has dedicated his or her career to bankruptcy law.
Once you narrow down the list of attorneys you are considering, the next phase in considering bankruptcy is to obtain references in regard to each of these attorneys’ prior performance. References will provide you with specific information on how a particular lawyer handles his or her business and on how successful he or she has been in the pursuit of prior bankruptcy cases. Your local bar association can provide you with the names of lawyers that specialize in the practice of bankruptcy law.
The final step in considering bankruptcy is to actually engage the services of an attorney. At this juncture, you attorney will prepare a bankruptcy petition on your behalf that will be filed in the bankruptcy court. With the filing, your creditors will have to suspend seeking debt collection from you during the period in which the bankruptcy case is pending.
By following the steps outlined in this article, you will be able to take serious action in order to get your financial house in order. Of course, bankruptcy really is an option of last resort when it comes to dealing with impossible debt. Therefore, you need to make sure you have exhausted any alternative options before you actually begin the course of pursuing a bankruptcy case.
http://www.bestnichearticles.com/Article/Seven-Steps-on-How-to-File-for-Bankruptcy/6462
The first step in learning how to file for bankruptcy is to make a comprehensive list of all of your creditors and outstanding debts. When you are working to determine how to file for bankruptcy, you need to appreciate that if you to proceed with a bankruptcy case, you must be sure that all of your debts are disclosed and listed in a bankruptcy petition.
The next step in filing for bankruptcy is to determine exactly what assets you have available to you. Your assets include your recurring income from your job, your home and major items of personal property that you might own (including such items as motor vehicles).
The third step you need to undertake when it comes to seeking bankruptcy relief is to contact all three major credit bureaus. When all is said and done, the three major credit bureaus may have the best record of all of your outstanding debt. By obtaining your credit reports from the three major credit bureaus, you will be able to cross reference your list of debt to make certain that you have all accounts covered and listed.
The forth factor that needs to be considered on the road to filing for bankruptcy, is to determine whether you will seek professional assistance in the pursuit of a bankruptcy case. Some people do elect to file for bankruptcy on their own without the aid and assistance of a lawyer. However, in most instances, it probably is in your best interest to seek the professional assistance of a lawyer in order to properly pursue a bankruptcy case. Therefore, unless you have a very simple bankruptcy on the horizon and unless you actually have some definite, practical legal experience, you should seek out the assistance of a lawyer to aid you in pursuing your case.
In working towards fully understanding how to file for bankruptcy, if you do make the decision to hire a lawyer, you will need to begin an organized search to find the best attorney to meet your needs. Keep in mind that in this day and age there are lawyers that specialize specifically in the area of consumer bankruptcies. As a result, you most likely will want to narrow your search to those specific attorneys who do have experience in dealing with bankruptcy cases. In the long run, you will be best served by engaging the services of a lawyer who has dedicated his or her career to bankruptcy law.
Once you narrow down the list of attorneys you are considering, the next phase in considering bankruptcy is to obtain references in regard to each of these attorneys’ prior performance. References will provide you with specific information on how a particular lawyer handles his or her business and on how successful he or she has been in the pursuit of prior bankruptcy cases. Your local bar association can provide you with the names of lawyers that specialize in the practice of bankruptcy law.
The final step in considering bankruptcy is to actually engage the services of an attorney. At this juncture, you attorney will prepare a bankruptcy petition on your behalf that will be filed in the bankruptcy court. With the filing, your creditors will have to suspend seeking debt collection from you during the period in which the bankruptcy case is pending.
By following the steps outlined in this article, you will be able to take serious action in order to get your financial house in order. Of course, bankruptcy really is an option of last resort when it comes to dealing with impossible debt. Therefore, you need to make sure you have exhausted any alternative options before you actually begin the course of pursuing a bankruptcy case.
http://www.bestnichearticles.com/Article/Seven-Steps-on-How-to-File-for-Bankruptcy/6462
What to Consider when Filing for Personal Bankruptcy
President Bush in April signed into law The Bankruptcy Abuse and Consumer Protection Act. This bill promises many changes to law, and will make it more difficult for the average person in financial trouble to have debts removed with bankruptcy. Recent social and economic changes indicate that those considering a bankruptcy should do so now, as the queue is getting longer.
It will be now be harder to file under Chapter 7 of the code, which allows the courts to wave consumer debt and give the debtor a new start. Filings posted will be tested and those who have a decent income it seems will have to file under a more strenuous Chapter 13, which demands repayment by installments and the assistance of a lawyer. Now looming, bankruptcy filings are not only higher than they were previously, but are also higher than expected. Acros the country, filings are substantially higher than last year, and some bankruptcy practitioners say that their business has increased dramatically.
To make it more confusing is another law, that requires credit card companies to establish a payment schedule that permits consumers to repay debts in amended installments. Since early year, most credit card providers have doubled their minimum payments. An average person with say $12,000 in credit card debt, will have approximate monthly payment increases from between $150 to $450, an increase most people can ill afford.
This increase in bankruptcy filings has overwhelmed bankruptcy lawyers, who face a burden of being liable for false information filed by clients once the new law takes effect. Certainly an unwelcome change. This additional liability, together with the additional tasks, has prompted many lawyers to raise fees subsstantally over the same time as last year.
What does this mean for bad debt? From here on, bankruptcy filings will be more confusing, complicated and costly. The system is already overloaded with bankruptcy cases. If you suspect you're in the bankruptcy category, you should move on it now. Waiting even another day could be too late.
http://www.bestnichearticles.com/Article/What-to-Consider-when-Filing-for-Personal-Bankruptcy/2683
It will be now be harder to file under Chapter 7 of the code, which allows the courts to wave consumer debt and give the debtor a new start. Filings posted will be tested and those who have a decent income it seems will have to file under a more strenuous Chapter 13, which demands repayment by installments and the assistance of a lawyer. Now looming, bankruptcy filings are not only higher than they were previously, but are also higher than expected. Acros the country, filings are substantially higher than last year, and some bankruptcy practitioners say that their business has increased dramatically.
To make it more confusing is another law, that requires credit card companies to establish a payment schedule that permits consumers to repay debts in amended installments. Since early year, most credit card providers have doubled their minimum payments. An average person with say $12,000 in credit card debt, will have approximate monthly payment increases from between $150 to $450, an increase most people can ill afford.
This increase in bankruptcy filings has overwhelmed bankruptcy lawyers, who face a burden of being liable for false information filed by clients once the new law takes effect. Certainly an unwelcome change. This additional liability, together with the additional tasks, has prompted many lawyers to raise fees subsstantally over the same time as last year.
What does this mean for bad debt? From here on, bankruptcy filings will be more confusing, complicated and costly. The system is already overloaded with bankruptcy cases. If you suspect you're in the bankruptcy category, you should move on it now. Waiting even another day could be too late.
http://www.bestnichearticles.com/Article/What-to-Consider-when-Filing-for-Personal-Bankruptcy/2683
Looking For An Effective Bankruptcy Lawyer
Bankruptcy is a specialized area of law that can be far more complex than appears on the outside. The issues are not always apparent or simple. Pick a bankruptcy lawyer who can help you work through the issues, alternatives, and conclusions of your own choices. Pick a lawyer with whom you are comfortable, one whom you can ask questions and get responses you understand. He or she is specialized in bankruptcy or does a large part of his or her practice in the field.
It is also good if you ask questions until you understand what your choices are. And also do not be afraid to interview a lawyer and leave without retaining if you are not satisfied.
Look for a certified specialist or a lawyer with significant experience in bankruptcy. Never associate your self to a generalist, he or she might do a simple bankruptcy, but may not be able to tell the status of your case.
You can also ask for any local bar associations, they have a referral panels of bankruptcy. You can ask them about their experience with cases like yours. If you find it hard trusting them, you can use your yellow pages for other lawyers.
It is better to interview lawyers until you find one who suits you. Ask how many cases like yours he or she handles, and how long he or she has been practicing bankruptcy. And find someone with whom you can communicate well with.
A bankruptcy lawyer will be committed to getting you debt relief and providing you with valuable information, services and advice to get you a better financial future. They may also give you advice on where it is better to file bankruptcy.
On your first visit to your lawyer's office you should bring a list of all the creditors that you owe. This includes debts that you are not behind on like credit cards, medical bills, taxes, cars, houses, and personal loans. The better the information that you give to your lawyer, the better their advice will be. The list of your assets and income is also needed.
Your lawyer can also stop your creditors harassment, immediately once you retain a lawyer to file your bankruptcy they will start taking your creditor calls.
You should also take advantage on your lawyer's expertise. He or she can talk to you about everything in regards to your financial condition. Take note that without all the debt information your right cannot be protected. All too often, information that a client withholds because they think it is troublesome presents no problem, if disclosed. Lying to your lawyer may cause a problem where none existed before.
Read carefully the representation agreement, the draft schedules, the court notices and communications from your lawyer. Ask your lawyer questions what you do not understand at first. Inexact or not whole information can have severe and obnoxious penalties.
Cooperate in providing promptly information and feed back with your bankruptcy lawyer when requested so that court deadlines can be met. Take responsibility for your case. You are the person with the best handle on the facts of the case and the one most affected by the case's outcome. Your lawyer can file a bankruptcy with you, but not for you. He or she may help you, but not all the time. Remember, he or she is a lawyer, lawyers can only help you in regards to legal aspects.
http://www.bestnichearticles.com/Article/Looking-For-An-Effective-Bankruptcy-Lawyer/974
It is also good if you ask questions until you understand what your choices are. And also do not be afraid to interview a lawyer and leave without retaining if you are not satisfied.
Look for a certified specialist or a lawyer with significant experience in bankruptcy. Never associate your self to a generalist, he or she might do a simple bankruptcy, but may not be able to tell the status of your case.
You can also ask for any local bar associations, they have a referral panels of bankruptcy. You can ask them about their experience with cases like yours. If you find it hard trusting them, you can use your yellow pages for other lawyers.
It is better to interview lawyers until you find one who suits you. Ask how many cases like yours he or she handles, and how long he or she has been practicing bankruptcy. And find someone with whom you can communicate well with.
A bankruptcy lawyer will be committed to getting you debt relief and providing you with valuable information, services and advice to get you a better financial future. They may also give you advice on where it is better to file bankruptcy.
On your first visit to your lawyer's office you should bring a list of all the creditors that you owe. This includes debts that you are not behind on like credit cards, medical bills, taxes, cars, houses, and personal loans. The better the information that you give to your lawyer, the better their advice will be. The list of your assets and income is also needed.
Your lawyer can also stop your creditors harassment, immediately once you retain a lawyer to file your bankruptcy they will start taking your creditor calls.
You should also take advantage on your lawyer's expertise. He or she can talk to you about everything in regards to your financial condition. Take note that without all the debt information your right cannot be protected. All too often, information that a client withholds because they think it is troublesome presents no problem, if disclosed. Lying to your lawyer may cause a problem where none existed before.
Read carefully the representation agreement, the draft schedules, the court notices and communications from your lawyer. Ask your lawyer questions what you do not understand at first. Inexact or not whole information can have severe and obnoxious penalties.
Cooperate in providing promptly information and feed back with your bankruptcy lawyer when requested so that court deadlines can be met. Take responsibility for your case. You are the person with the best handle on the facts of the case and the one most affected by the case's outcome. Your lawyer can file a bankruptcy with you, but not for you. He or she may help you, but not all the time. Remember, he or she is a lawyer, lawyers can only help you in regards to legal aspects.
http://www.bestnichearticles.com/Article/Looking-For-An-Effective-Bankruptcy-Lawyer/974
Mortgage after Bankruptcy - Bankruptcy Discharged Yesterday? Purchase a Home Today!
So you have been through a bankruptcy and surely have been told to wait at least two years before applying for a home loan. Waiting two long years without any guarantee of being approved for a mortgage after bankruptcy can be disheartening. Fortunately, this advice no longer holds true.
Today, there is a growing realization of the need to offer home loan products that are specifically designed for borrowers with an imperfect credit or financial history. Mortgage programs have been created especially for borrowers who have gone through a bankruptcy. In fact, those with a bankruptcy discharged for even one day may apply for a home loan. That's right, if your bankruptcy was discharged yesterday, you can qualify for a mortgage today!
Now you are probably thinking that although you are eligible, it will be difficult to qualify. The truth is that qualifying is much easier than you think. The fact that you have been through bankruptcy is not even considered in the evaluation of your credit. Any liens, collections or judgments that appear on your credit report will also not be used in the evaluation of credit and will not need to be paid off.
What is important and what will be looked at is your credit score. Now here is the good news: with a minimum FICO score of 500, you are qualified to purchase a home with a 20% down payment. Having a credit score between 550 and 579 will allow you to borrow up to 95% of the purchase price; and with any score above 580, you are qualified for 100% financing.
With the competitive rates that are available on mortgage after bankruptcy programs, you are able to realize the dream of homeownership with a mortgage payment that is affordable and fits easily within your budget. Along with the traditional benefits of owning a home, such as equity building and tax benefits, you will most importantly be rebuilding your credit profile. Additionally, you may also benefit from the current strong housing market and its appreciating home values.
So now you know the following: that you can qualify for a home loan today, what the credit requirements for a mortgage are, and that you can rebuild your credit and financial life through homeownership. Gone forever are the days of waiting two years and living with the dim prospect of obtaining a mortgage after bankruptcy. You have worked hard to discharge your bankruptcy and have the fresh start that you were looking for.
There is empowerment that comes with the knowledge that you can purchase a home today even if your bankruptcy was discharged yesterday. So get qualified for a home loan, start searching for a home and begin packing those boxes!
http://www.bestnichearticles.com/Article/Mortgage-after-Bankruptcy---Bankruptcy-Discharged-Yesterday--Purchase-a-Home-Today-/828
Today, there is a growing realization of the need to offer home loan products that are specifically designed for borrowers with an imperfect credit or financial history. Mortgage programs have been created especially for borrowers who have gone through a bankruptcy. In fact, those with a bankruptcy discharged for even one day may apply for a home loan. That's right, if your bankruptcy was discharged yesterday, you can qualify for a mortgage today!
Now you are probably thinking that although you are eligible, it will be difficult to qualify. The truth is that qualifying is much easier than you think. The fact that you have been through bankruptcy is not even considered in the evaluation of your credit. Any liens, collections or judgments that appear on your credit report will also not be used in the evaluation of credit and will not need to be paid off.
What is important and what will be looked at is your credit score. Now here is the good news: with a minimum FICO score of 500, you are qualified to purchase a home with a 20% down payment. Having a credit score between 550 and 579 will allow you to borrow up to 95% of the purchase price; and with any score above 580, you are qualified for 100% financing.
With the competitive rates that are available on mortgage after bankruptcy programs, you are able to realize the dream of homeownership with a mortgage payment that is affordable and fits easily within your budget. Along with the traditional benefits of owning a home, such as equity building and tax benefits, you will most importantly be rebuilding your credit profile. Additionally, you may also benefit from the current strong housing market and its appreciating home values.
So now you know the following: that you can qualify for a home loan today, what the credit requirements for a mortgage are, and that you can rebuild your credit and financial life through homeownership. Gone forever are the days of waiting two years and living with the dim prospect of obtaining a mortgage after bankruptcy. You have worked hard to discharge your bankruptcy and have the fresh start that you were looking for.
There is empowerment that comes with the knowledge that you can purchase a home today even if your bankruptcy was discharged yesterday. So get qualified for a home loan, start searching for a home and begin packing those boxes!
http://www.bestnichearticles.com/Article/Mortgage-after-Bankruptcy---Bankruptcy-Discharged-Yesterday--Purchase-a-Home-Today-/828
For many people, filing for bankruptcy is one of the most painful emotionally things they will have to do in their lives. It may mean the worst of your bills will go away, but it also means that you will have trouble getting credit for years. It may mean losing your home or your car. It's not pleasant even when it's the only way out.
But once it's done and over with it is time to start trying to get past that and rebuild your life and credit. You will just have to find banks that can work with you.
In many cases this means getting a secured credit card or an unsecured one that doesn't do a credit check. Whichever you get, make sure that you make your payments on time and regularly. It will take a couple years of this to prove that you are again credit-worthy, and you will probably be paying higher interest rates and/or fees for these cards, but over time you will come to the point where you can get regular credit cards again.
But more important is the impact a bankruptcy can have on your personal relationships. It's a major strain on them. Your money troubles do not vanish with the filing of bankruptcy. The things you have to give up as a result, the changes you need to make, the emotional lows of going through a bankruptcy are extremely hard on relationships.
Getting past these is in many ways harder. You may have to seek counseling. You will certainly need to talk about changing any shared habits that contributed to the bankruptcy. And you will need all possible emotional support.
If you have to hunt for work, a bankruptcy can make it harder to find a job, as many employers check credit histories. There is a feeling that people who are not responsible with their credit may not be as good of employees. Even if the bankruptcy was due to factors beyond your control, such as medical bills, this is something you may have to face.
Make a plan to improve your spending habits, especially any that were major contributing factors to the bankruptcy. Learn to live without buying so much stuff. Eat out less often. Find cheaper forms of entertainment.
It will take two years or more of work to start proving yourself on your credit history, and it will be years before the bankruptcy comes off your record. The more serious you are about showing that you have learned your lesson and that you can now be trusted, the sooner you can rebuild your credit.
http://www.bestnichearticles.com/Article/Getting-Past-a-Bankruptcy/86216
But once it's done and over with it is time to start trying to get past that and rebuild your life and credit. You will just have to find banks that can work with you.
In many cases this means getting a secured credit card or an unsecured one that doesn't do a credit check. Whichever you get, make sure that you make your payments on time and regularly. It will take a couple years of this to prove that you are again credit-worthy, and you will probably be paying higher interest rates and/or fees for these cards, but over time you will come to the point where you can get regular credit cards again.
But more important is the impact a bankruptcy can have on your personal relationships. It's a major strain on them. Your money troubles do not vanish with the filing of bankruptcy. The things you have to give up as a result, the changes you need to make, the emotional lows of going through a bankruptcy are extremely hard on relationships.
Getting past these is in many ways harder. You may have to seek counseling. You will certainly need to talk about changing any shared habits that contributed to the bankruptcy. And you will need all possible emotional support.
If you have to hunt for work, a bankruptcy can make it harder to find a job, as many employers check credit histories. There is a feeling that people who are not responsible with their credit may not be as good of employees. Even if the bankruptcy was due to factors beyond your control, such as medical bills, this is something you may have to face.
Make a plan to improve your spending habits, especially any that were major contributing factors to the bankruptcy. Learn to live without buying so much stuff. Eat out less often. Find cheaper forms of entertainment.
It will take two years or more of work to start proving yourself on your credit history, and it will be years before the bankruptcy comes off your record. The more serious you are about showing that you have learned your lesson and that you can now be trusted, the sooner you can rebuild your credit.
http://www.bestnichearticles.com/Article/Getting-Past-a-Bankruptcy/86216
Saturday, July 14, 2007
How To Recover From Personal Bankruptcy
It almost goes without saying that nobody PLANS to file for bankruptcy. The detrimental effects of bankruptcy on your life and for 7 to 10 years on your credit report is not something that anyone would want to do or plan for, given a viable choice. One of the most difficult things about filing for personal bankruptcy, especially in the past several years, is that after coming out of bankruptcy, all of a sudden you find that people, even your friends, start to treat you like you have leprosy or the plague. You even find yourself feeling guilty when you buy something, even a gallon of milk at the grocery store, because there is also a psychological detriment to declaring bankruptcy. You feel as if you have failed -- failed yourself as well as your family.
Things happen and you need to embrace that fact. You didn't PLAN to file bankruptcy, it was just an unfortunate series of events or circumstance. The very first thing you need to do is to get over the psychological effects of it. You are not a bad person, and in fact, in the course of mentally reviewing what led you to that point (which you probably do several times a day anyway, right?), you have actually LEARNED some things along the way, which will allow you to avoid the same pitfalls in the future as you move forward with your life.
After you have declared bankruptcy, you need to understand that life goes on. You will still need to purchase basic necessities of life, you will still need a place to live, you will still need a car, etc. But one of the things you will undoubtedly find, and find quickly, is that obtaining credit for something like a mortgage or even a used car is going to be very difficult. To qualify for a loan after bankruptcy, you are going to have to be able to meet the lender's minimum criteria for your credit score, and bankruptcy puts a serious dent in your credit score rating number. The lower your credit score, the greater the chance that the lender will deny your loan request, or in best case, will approve your loan but at an interest rate that would make Bill Gates' eyes roll.
After you have obtained your loan and/or new credit cards, make more than the minimum payment and make sure you make that payment so that it gets posted to your account BEFORE the due date. For example, if your minimum payment is $25, make the payment for $30, or even more if you can afford it. If your payment is due on the 10th of the month, make sure you mail it no later than the 3rd of the month to make sure it reaches them on time AND gets posted to your account before the due date. Many banks offer free online checking and free online bill paying, which is a great way to go to get those bills paid on time. It's all done electronically, and besides saving yourself the cost of a stamp, you have also saved yourself the hassle of the possibility of delayed postal mail and the delay of the MANUAL process for the lender to post the payment to your account.
The bottom line is to make sure you have LEARNED something from the necessity of filing for bankruptcy. Understand what went wrong and be sure to watch for those pitfalls to make sure that you do not need to repeat that bankruptcy step.
About the Author
Jon is a computer engineer who maintains web sites on a variety of topics based on his knowledge and experience. You can read more about Bankruptcy Advice at his web site at Bankruptcy Advice
Things happen and you need to embrace that fact. You didn't PLAN to file bankruptcy, it was just an unfortunate series of events or circumstance. The very first thing you need to do is to get over the psychological effects of it. You are not a bad person, and in fact, in the course of mentally reviewing what led you to that point (which you probably do several times a day anyway, right?), you have actually LEARNED some things along the way, which will allow you to avoid the same pitfalls in the future as you move forward with your life.
After you have declared bankruptcy, you need to understand that life goes on. You will still need to purchase basic necessities of life, you will still need a place to live, you will still need a car, etc. But one of the things you will undoubtedly find, and find quickly, is that obtaining credit for something like a mortgage or even a used car is going to be very difficult. To qualify for a loan after bankruptcy, you are going to have to be able to meet the lender's minimum criteria for your credit score, and bankruptcy puts a serious dent in your credit score rating number. The lower your credit score, the greater the chance that the lender will deny your loan request, or in best case, will approve your loan but at an interest rate that would make Bill Gates' eyes roll.
After you have obtained your loan and/or new credit cards, make more than the minimum payment and make sure you make that payment so that it gets posted to your account BEFORE the due date. For example, if your minimum payment is $25, make the payment for $30, or even more if you can afford it. If your payment is due on the 10th of the month, make sure you mail it no later than the 3rd of the month to make sure it reaches them on time AND gets posted to your account before the due date. Many banks offer free online checking and free online bill paying, which is a great way to go to get those bills paid on time. It's all done electronically, and besides saving yourself the cost of a stamp, you have also saved yourself the hassle of the possibility of delayed postal mail and the delay of the MANUAL process for the lender to post the payment to your account.
The bottom line is to make sure you have LEARNED something from the necessity of filing for bankruptcy. Understand what went wrong and be sure to watch for those pitfalls to make sure that you do not need to repeat that bankruptcy step.
About the Author
Jon is a computer engineer who maintains web sites on a variety of topics based on his knowledge and experience. You can read more about Bankruptcy Advice at his web site at Bankruptcy Advice
What You Must Consider Before Filing Bankruptcy
Bankruptcy is not something that you do on the spur of the moment, but rather it should be a well thought out plan that you only implement when you have exhausted all other possibilities. While bankruptcy may provide a way out of your current financial situation, you need to consider and be aware that the ramifications of filing bankruptcy are going to haunt you for the next 7 to 10 years. Many people who file bankruptcy are doing so to make things better "now" but they are not looking years down the road, and when they do and wish they had considered other options, it is then too late.
If you are on the very edge of filing bankruptcy and need a way out, there are multiple other options that may be available to you. If you feel like you're hopelessly buried in debt and you have very few assets, filing for bankruptcy may not be the answer to ending your financial problems. Though it sounds like an easy and attractive solution for one's financial problems, bankruptcy should be the last option any individual should resort to.
Throughout the process of filing for bankruptcy, it is a good idea to have a lawyer represent you through all formal bankruptcy proceedings. Unless you yourself are very familiar with bankruptcy law, especially the variations of the law within your state, it is more than just a good idea to have a bankruptcy lawyer represent you; it is almost a necessity so that you don't accidentally get yourself into worse trouble than you are right now. From start to finish, the process of filing for bankruptcy is much different than it has been in decades past, and a good bankruptcy attorney knows those pitfalls and can navigate around them.
Before taking the big step and filing for bankruptcy, you will need to do some reading, especially so that you can explain to your bankruptcy attorney the reason for considering bankruptcy. You may need to consider filing bankruptcy if your expenses are increasing because of divorce, job loss, or medical bills, while your income is decreasing because of the same reason. There are various good reasons for filing bankruptcy, but there are also many BAD reasons for filing bankruptcy, based on the ease with which one could do that in years past, but most of those loopholes have been closed, and it is not nearly as easy today to file a non-painful bankruptcy case.
If you have decided there is no alternative to filing bankruptcy, you may be asking yourself, "how do I find a good bankruptcy lawyer? If you have exhausted all other resources and still feel bankruptcy is your only viable option you can learn more about filing bankruptcy or buy do it yourself bankruptcy forms. If you're unemployed, on public assistance, have little or no money in a bank account, don't own an automobile, or rent or live with others, filing for bankruptcy may do little to improve your financial situation. The bankruptcy judge is going to want to see a plan of how you plan to change your current situation so that you are not back in the same position in another few years, so be sure that you discuss a financial plan with your bankruptcy lawyer.
About the Author
Jon is a computer engineer who maintains web sites on a variety of topics based on his knowledge and experience. You can read more about bankruptcy and options at his web site at Bankruptcy Advice
If you are on the very edge of filing bankruptcy and need a way out, there are multiple other options that may be available to you. If you feel like you're hopelessly buried in debt and you have very few assets, filing for bankruptcy may not be the answer to ending your financial problems. Though it sounds like an easy and attractive solution for one's financial problems, bankruptcy should be the last option any individual should resort to.
Throughout the process of filing for bankruptcy, it is a good idea to have a lawyer represent you through all formal bankruptcy proceedings. Unless you yourself are very familiar with bankruptcy law, especially the variations of the law within your state, it is more than just a good idea to have a bankruptcy lawyer represent you; it is almost a necessity so that you don't accidentally get yourself into worse trouble than you are right now. From start to finish, the process of filing for bankruptcy is much different than it has been in decades past, and a good bankruptcy attorney knows those pitfalls and can navigate around them.
Before taking the big step and filing for bankruptcy, you will need to do some reading, especially so that you can explain to your bankruptcy attorney the reason for considering bankruptcy. You may need to consider filing bankruptcy if your expenses are increasing because of divorce, job loss, or medical bills, while your income is decreasing because of the same reason. There are various good reasons for filing bankruptcy, but there are also many BAD reasons for filing bankruptcy, based on the ease with which one could do that in years past, but most of those loopholes have been closed, and it is not nearly as easy today to file a non-painful bankruptcy case.
If you have decided there is no alternative to filing bankruptcy, you may be asking yourself, "how do I find a good bankruptcy lawyer? If you have exhausted all other resources and still feel bankruptcy is your only viable option you can learn more about filing bankruptcy or buy do it yourself bankruptcy forms. If you're unemployed, on public assistance, have little or no money in a bank account, don't own an automobile, or rent or live with others, filing for bankruptcy may do little to improve your financial situation. The bankruptcy judge is going to want to see a plan of how you plan to change your current situation so that you are not back in the same position in another few years, so be sure that you discuss a financial plan with your bankruptcy lawyer.
About the Author
Jon is a computer engineer who maintains web sites on a variety of topics based on his knowledge and experience. You can read more about bankruptcy and options at his web site at Bankruptcy Advice
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