• bankruptcy
  • chapter
  • will
  • these
  • Manage Your Debt Absolutely: Bankruptcy

    OK perhaps the above headline might be accused as being slightly on the sensationalist side of things but go with me slightly as I explain my reasoning and the logic behind such a potentially controversial headline.

    Today, petitioners must undergo the 'means' test to determine which chapter they qualify for. Essentially, the means test compares debtors' income to medium income within their state of residence. Only those who earn less than medium levels qualify for Chapter 7. Everyone else must enter into Chapter 13.

    Due to the regulations of the Bankruptcy Court in the US, we now have credit counseling classes. To determine if bankruptcy filing is indeed the best option out there, people who file for bankruptcy are required to take two of these classes. Your town bankruptcy courts typically have a list of credit counseling classes that are acceptable for you to refer to. You then have the option of going through your credit counseling class online or on the phone.

    Bankruptcy filings by individuals during the first nine months of 2010 increased by 12 percent compared to the same period last year. The most common types of bankruptcy filed by consumers are chapter 7 and chapter 13.

    Filing for bankruptcy is no mean task. The laws related to it can get difficult to understand and more often than not you will get lost in it all. At these times, a good idea would be to have a bankruptcy lawyer guide you through the entire process. Once you decide that you will need the services of a bankruptcy attorney, the next task is to zero in on one that can really help you.

    Before you consider personal bankruptcy, you will need to look through the alternatives. Any one of them may work for you depending on the financial situation that you are in. seeking financial counseling in these matters would be a good idea. One of the options is to hire a finance manager. This will mean that you lose control over your own finances, but it is good way to bring them back on track. If you can discipline yourself, then hiring a financial counselor may work for you as well. Use his help in creating a budget for yourself.

    This is where bankruptcy can be a key factor in both rebuilding one’s financial life and even improving one’s credit. Certainly, either a Chapter 7 Bankruptcy or Chapter 13 Bankruptcy will have an adverse impact on a debtor’s credit in the short-term. However, a bankruptcy discharge is like a branch extended to the debtor sinking in quicksand. Whether you file a Chapter 7 or Chapter 13 Bankruptcy, you will receive a discharge so that you start over with most or all of your financial obligations being eliminated. There are exceptions as some debts may not be subject to discharge or be more difficult to discharge including student loans and taxes or secured debts where you choose to keep the collateral (i.e. family home or vehicle).