Everyone agrees that bankruptcy is scary. Yet, when the bills start to become too much to handle, it is very often a necessary activity. One often has a helpless feeling as they are flooded with collection calls and letters. Regardless, for many, bankruptcy does provide a solution. Nevertheless, despite the benefits, there are some drawbacks. Today’s article provides some fast but important bankruptcy facts you need to know.
Firstly, there is a myth that needs to be dispelled. Many people believe that bankruptcy is for those people and businesses who have hit rock bottom. The idea is that either a bad financial decision or an unforeseen event has left the person or organization unable to handle their bills. While this is the point when many approach a bankruptcy attorney, the government created bankruptcy laws to help manage debt and help one from hitting rock bottom. A business or person can recognize their debt so that they can make repayment.
Bankruptcy Facts You Need to Know
1. Different Types for Different Needs – The Bankruptcy Code provides different solutions for different situations. Individuals can file either Chapter 7 or Chapter 13, depending on whether they need debts discharged or reorganized. Other options include Chapter 11 for businesses, Chapter 12 for family farms and fisherman, and Chapter 15 for persons from other countries.
2. Some Debts Can’t Be Discharged – Bankruptcy is not an easy way out of paying debts. Moreover, it is important to understand that not all debts are suitable to be discharged. A bankruptcy will not help you if you owe child support or taxes. In these instances, other options, like refinancing the obligation, should be exhausted first.
3. Bankruptcy Filings Are Public – There is significant paperwork when filing for bankruptcy. Moreover, your finances are likely to be meticulously scrutinized. It is important to know that all these court papers are part of the public record. Moreover, names involved in court proceedings will often find their way into newspapers and online.
Would you like to learn more important bankruptcy facts? Please contact us if you would like to talk about this or related topics.
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