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Chapter 13 bankruptcy advice

Bankruptcy is a legal process of elimination of debt presented in a Court of law. The main objective is to relieve individuals or companies that cannot pay its accumulated debts of their financial obligations. The purpose of bankruptcy is to offer a new start in one of the finance.

This means that someone who has debts is expressing its willingness to pay the same, but within a period of three to five years. This is preferred by a lot of people and companies who want to maintain their current living standards, while they pay their accumulated debts.

Presentation of a chapter 13 requires the individual to present a petition of bankruptcy and a list of your assets and liabilities. After this, the individual must file a repayment plan and the duration in which plan he or she to. This is checked by all interested borrowers that check if this can really happen. Once the points of controversy and confrontation are resolved, it is responsibility of the person who has declared bankruptcy, as well as creditors to follow the reorganization plan submitted.

There are additional confirmatory tests remaining before the final reorganization of the bankruptcy. The tests aim to compare the amounts received by unsecured creditors by the plan and the amount you would receive if a chapter 7 bankruptcy. This is to ensure parity between the two clauses of the bankruptcy and the creditors are made both as. Do a final test is performed in which the individual? S ability to pay is assessed.

Chapter 13 is more beneficial for those people who want to keep certain possessions, such as a? Origin s. For example, if a consumer has lost the mortgage the House and is facing the possibility of foreclosure, it can be stopped by the chapter 13 bankruptcy filing. This is usually called an automatic suspension and allows time for the consumer to update with the lost payment.

Chapter 13 bankruptcy advice can be best obtained from a lawyer who has extensive experience in the treatment of these cases. However, a word of advice is that you don’t have to qualify for chapter 13 bankruptcy unless the conditions are extremely serious. This is because once the files from someone, the consumer? Credit s suffers and is recorded for about 10 years, making it almost impossible to obtain a credit in the future.