there is a good chance that the debt will be discharged
Miami, FL (PRWEB) April 17, 2017
Debt consolidation is a helpful program in managing debt payments and National Debt Relief wants to help consumers understand what happens to it in case of a bankruptcy filing. The article titled “How Are Debt Consolidation Loans Handled In Bankruptcy?” and published March 29, 2017 points out how a debt consolidation loan would be treated when consumers undergo bankruptcy.
The article starts off by pointing out that there are a lot of consumers who are looking for a way out of debt. In these situations, debt consolidation becomes a very viable debt relief program which can help people manage their payments. As consumers use debt consolidation, there are those asking what happens with the loan once they consider filing for bankruptcy.
The article explains that it is important to understand what a debt consolidation is all about. It basically allows a person to combine multiple debt obligations under one account. This offers the freedom of streamlining payments with one payment amount, one due date and even one interest rate. These types of loans can be secured or unsecured loans.
The article then goes on to explain that people who are having a hard time making payments have an option of filing for bankruptcy. People can choose between Chapter 7 or Chapter 13 where the difference is a repayment plan for the latter and asset liquidation for the former. Debt consolidated loans will be one of the items included in these filing.
The article points out that if the debt consolidation loan is an unsecured loan and the consumer is filing for a Chapter 7 bankruptcy, there is a good chance that the debt will be discharged. However, it is best for people to understand the process because they run the risk of having their debt considered “bad faith.”
To read the full article, click https://www.nationaldebtrelief.com/debt-consolidation-loans-bankruptcy/