What you need to know about bankruptcy assets
Bankruptcy serves as a real option for those who find themselves unable to pay off their debts. However, one of the main concerns that people have when it comes to bankruptcy is what will happen to their assets. To understand this, we must first explain the two most common forms of bankruptcy.
The most common form of bankruptcy is chapter seven bankruptcy. This is the kind that most people think about, and it is meant to completely wipe out your debts. In exchange for eliminating your debt, you will have to forfeit certain assets to help pay off your debt.
The other major form of bankruptcy is called chapter 13. Instead of just getting rid of your debt completely, chapter 13 is meant to form a payment plan to help you get back on track. This is often used to help people get caught up with their mortgage payments, and the repayment plan usually last 3 to 5 years. The good part about chapter 13 is that you don't have to forfeit any of your assets.
As you can see, chapter seven is the best option if you wish to rid yourself of your debt entirely. The major problem with this, besides the damage to your credit, is liquidation. In other words, you will have to get rid of some of your assets to help pay creditors what you owe them.
Of course, if you're filing for bankruptcy, then you may not have many assets to speak of. In fact, in virtually all cases, no assets are forfeited for one of two reasons. Either the consumer doesn't have any assets to sell, or they just aren't worth enough to bother with.
That brings us to a question of the two principle assets that most people are concerned with: their house and their car. In most states, there is a homestead exemption which helps to protect the family's a house from creditors. However, the specifics depend on many factors including the state in which you reside, as well as a value of your house and how much you owe.
Thus, in order to successfully file bankruptcy while protecting your assets as best as possible, it is crucial to discuss your case thoroughly with a good bankruptcy attorney. A good bankruptcy lawyer can help you through the difficult process.
However, it helps to learn as much as possible before speaking with your lawyer. You should continue to learn about your options with regards to bankruptcy from articles like this one.
The most common form of bankruptcy is chapter seven bankruptcy. This is the kind that most people think about, and it is meant to completely wipe out your debts. In exchange for eliminating your debt, you will have to forfeit certain assets to help pay off your debt.
The other major form of bankruptcy is called chapter 13. Instead of just getting rid of your debt completely, chapter 13 is meant to form a payment plan to help you get back on track. This is often used to help people get caught up with their mortgage payments, and the repayment plan usually last 3 to 5 years. The good part about chapter 13 is that you don't have to forfeit any of your assets.
As you can see, chapter seven is the best option if you wish to rid yourself of your debt entirely. The major problem with this, besides the damage to your credit, is liquidation. In other words, you will have to get rid of some of your assets to help pay creditors what you owe them.
Of course, if you're filing for bankruptcy, then you may not have many assets to speak of. In fact, in virtually all cases, no assets are forfeited for one of two reasons. Either the consumer doesn't have any assets to sell, or they just aren't worth enough to bother with.
That brings us to a question of the two principle assets that most people are concerned with: their house and their car. In most states, there is a homestead exemption which helps to protect the family's a house from creditors. However, the specifics depend on many factors including the state in which you reside, as well as a value of your house and how much you owe.
Thus, in order to successfully file bankruptcy while protecting your assets as best as possible, it is crucial to discuss your case thoroughly with a good bankruptcy attorney. A good bankruptcy lawyer can help you through the difficult process.
However, it helps to learn as much as possible before speaking with your lawyer. You should continue to learn about your options with regards to bankruptcy from articles like this one.
About the Author:
Don't let the fear of your debt take over your life. Get the facts about bankruptcy and learn how to get control of your debt. To learn more about what is the new bankruptcy law visit us at http://personalbankruptcyquestions.org
posted by Debt Consolidation Loan at
8:19 AM
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