bankruptcy is a legal status granted by the court
New York, NY (PRWEB) November 01, 2017
Bankruptcy is a financial situation that is often misunderstood by a lot of consumers and National Debt Relief aims to explain the program better. The article titled “How To Figure Out If Bankruptcy Is Your Only Option” released October 26, 2017, shares what bankruptcy is and explains two of the most common programs under it.
The article starts off by pointing out that bankruptcy is a legal status granted by the court only after an exhaustive proceeding. A bankruptcy status will only come bankruptcy courts and not simply declared by consumers. The programs are aimed at giving consumers the chance to structure their debt payments and pay back their creditors as much as possible.
The article explains the two most common types of bankruptcy starting with Chapter 7. This is where consumers go through the process of liquidating most of their assets in a bid to pay down their debt obligation. The article points out that there are certain possessions that are exempt from this process to help keep the consumer from living off the street.
Chapter 13 bankruptcy is another one that helps consumers address their debt problems. The difference from Chapter 7 is that this does not require assets to be sold off. The article explains that the court puts out a hold on debt obligations and helps consumers come up with a repayment program based on their income and not the balance due.
The article also points out that as bankruptcy remains to be a valid financial option on the table, it does not work for all types of debt. As it could work best for unsecured loans, it might not be effective with those that involves a lien or a collateral. It might also be challenging for consumers to include student loans in bankruptcy unless they are able to prove “undue hardship.”
To read the full article, click https://www.nationaldebtrelief.com/bankruptcy-only-option/