Eps 70: How bankruptcy can kill you
— The too lazy to register an account podcast
Money is the single larg est source of stress in the US.
On National Stress Awareness Day , the connection between money, stress and bankruptcy merits some thought.
Eliminate debt as source of stress
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Levi Franklin
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Not all debts can be forgiven in bankruptcy, but many hope for a clean slate and a fresh start, which is not the case. Chapter 7 bankruptcy will relieve some, and in certain circumstances it may even reduce some secured debt.
Do you have questions about how the US government deals with taxes when someone files for bankruptcy? Chapter 13 bankruptcy can be filed if your income is above the average maximum. The debtor (the person declaring bankruptcy) must pay a percentage of what he or she owes over a period of 3-5 years and the property is liquidated, as explained below. Debtors and individuals filing for bankruptcy can choose between a one-time payment of $5,000 or a monthly payment of up to $1,500.
Chapter 7 aims to give honest debtors a fresh start by eliminating debt that can be discharged and allowing debtors to continue to be productive members of society. The bankruptcy law was passed not only to give people a "fresh start," but also to give indebted consumers the chance to repay their creditors.
If you are at the top of your debt and unable to repay the money owed, you may be interested in filing for bankruptcy. If you can repay money to your creditors, but need to escape payroll guarantees or seizure threats, then perhaps you should consider bankruptcy, according to the American Bankruptcy Institute.
People who are in arrears with bills but are not overwhelmed with debt may be able to get by without filing for insolvency, but forget it if they themselves get into debt one year after filing for insolvency. It doesn't matter if you've already sued, you can stop the process in its tracks by filing for bankruptcy. Find a way to make bankruptcy law work for you before you apply for it, according to the American Bankruptcy Institute.
Better still, if you often get the money from the back of your hand, and if the garnish has already begun, it can be stopped. If you think toppings are a possibility, consider a fresh start in bankruptcy.
It is better to explore your options before you take home 25% of your income and face a real emergency or financial crisis. If you find yourself in such a situation, filing for bankruptcy can be a great help, but it is not as easy as your creditors would have you believe.
Chapter 7 bankruptcy can make your financial picture more manageable and help a person regain control of their finances, especially if the source of financial stress is a source of financial stress. Chapter 7 bankruptcies can eliminate as many debtors and creditors as possible and sell their property (excluded from the law) to repay it.
Should a household of any income not default on a loan, be sued, or suffer foreclosure or expropriation? Shouldn't a secured debt, such as a mortgage or car loan, be foreclosed on and repaid if the debtor doesn't have enough money to afford it after deleveraging?
Default will destroy your creditworthiness, as will loss of income due to a poor credit rating, credit default swaps, or bankruptcy.
Others have been less fortunate and carry very high debt burdens without the benefits corresponding to their income, such as mortgages, credit cards, student loans, or credit card debt.
Chapter 13 bankruptcy (sometimes referred to as payroll bankruptcy) may be your only option if the court finds that you have no choice but to repay at least a good portion of your debt with your income. Filing for Chapter 13 bankruptcy allows you to pay off your debts within an agreed period. Once the repayment period is complete, all remaining unsecured debt (except for invoices arising from your bankruptcy filing) will be forgiven.
The court must approve your plan to repay all or part of the money owed, and the repayment plan must be completed over many years. Chapter 13 filing, you must pay legal fees and legal fees, meet repayment plans for many months, pay legal fees and legal fees, and have a good chance that your bankruptcy could end up costing you several thousand dollars.
Even if your debt is unrecoverable, you owe money to at least some creditors if you want to keep your secured assets.
You need to weigh up the pros and cons and whether the benefits outweigh the drawbacks, as well as the risks and benefits.
The reality is that if you have property that you are concerned about losing, your solicitor can review your situation and find out for you. In fact, a bankruptcy filing can stop a foreclosure and even get your car back if the bank repossesses your vehicle. If you have too much equity in your home, you can keep it and pay something to your unsecured creditors to get relief. However, if it is repossessed, it may also lead to you having to pay for it yourself.