by admin, September 4th, 2006 | No Comments
Bankruptcy Law - A Layman’s Perspective
Bankruptcy law is primarily comprised of the federal statutory law contained in Title 11 of the United States Code. One of the primary goals of the bankruptcy laws are to provide debtors with financial difficulty an opportunity for a fresh start.
In furtherance of this goal, bankruptcy law provides for the development of a bankruptcy plan that allows a debtor to resolve his debts through the division of his assets among his creditors. This court supervised division provides an orderly manner for the debtors non-exempt assets to be dispersed among the creditors with some measure of equality. It also also provides the debtor with assurance that when the bankruptcy is discharged they will have a fresh start free from the financial obligations incurred previous to the personal bankruptcy. more info
by admin, September 2nd, 2006 | No Comments
Bankruptcy Information - Alternatives to Bankruptcy
There are several possible alternatives to bankruptcy for those in financial trouble. It is important that when debtors consider these options they investigate the organizations they are dealing and make sure they do not do anything that places them in a worse situation. Some bankruptcy alternatives might have an impact on a subsequent bankruptcy filing if the alternative route does not work. The main alternatives are out-of-court settlement with creditors, debt counseling services, and debt consolidation loans.
Out-of-Court Settlement
Rather than file bankruptcy, one may attempt to consider settling your unsecured debt at a reduced amount. It is unlikely that an individual could do this independently but there are companies that will help you negotiate with your creditors. Is is important that these negotiations are handled properly and the consumer should seek professional help. As in all these actions there can be a negative effect on one’s credit rating.
Debt Counseling Service
Debt counseling services can be a good start in helping you deal with your financial difficulty. They can consolidate your monthly payments and obtain payment or interest reductions on your unsecured debts. The only problem with debt counseling is that many people are in such financial trouble that they will not qualify for debt counseling because they will not be able to repay their debt even under the better terms.
Debt Consolidation Loans
Another option is borrowing against the equity in one’s home to pay down credit card debt. This of course requires home equity and a careful consideration to make sure you are not putting yourself in a worse position. Not being able to pay your home equity loan could leave you in a worse position than not being able to pay your credit card debts.
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