With so many people in society today finding themselves in financial trouble more often, the rate of bankruptcy has been on the rise.

The main purpose of bankruptcy is to give honest debtors a fresh start, clearing most debts and discharging debtors from legal obligations and providing the trustee with non-exempt assets to be distributed among the creditors.

Originally a bankruptcy case is started with the filing of a petition. This petition declares the debtors financial information and states his intent to declare bankruptcy.

Most individuals, who file for bankruptcy, file a chapter 7. This is a liquidation bankruptcy. This is where the debtor’s non-exempt assets are sold off and distributed on the basis or priority amongst the creditors.

Bankruptcy shouldn’t be the first step though. Many people who find themselves in trouble immediately file for bankruptcy.

First talk with your creditors and try to work something out. They would rather take payments than deal with the paperwork and money that goes into legal action that they will need to take.

Next, speak with a non-profit debt consolidator. Many people who think they are deep in trouble are only borderline, and with some help and creative financial dealings, debts can be paid off without initiating a bankruptcy case.

When all else fails, a bankruptcy lawyer should be sought. They are experts in the steps that need to be taken from filing the paperwork to the court hearing to determine if the bankruptcy filing is legit. False filing for bankruptcy is a crime and punishable in court.

Chapter 13 Bankruptcy

2 Responses to “Bankruptcy”

1. Callum Ortiz Says:
   April 19th, 2009 at 6:36 pm

   Wow! Thank you! I always wanted to write something like that on my site. Can I take part of your post to my blog?

2. Delbert Says:
   May 28th, 2009 at 9:12 am

   I don’t usually reply to posts but I will in this case. I really enjoy your writing. I’ll be back.

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