Different Between Chapter 7 and Chapter 13

Bankruptcy Basics- Chapter 7 vs Chapter 13

According to the American Bankruptcy Institute, in the year 2010, more than 1.3 million people filed for bankruptcy. The reasons for the bankruptcies varied from loss of employment to salary cuts. With not much hope of a boom in the economy in the near future it is too much to hope for any dramatic changes in these figures in the current year.

For Americans drowning in huge debts, declaring bankruptcy may appear to be the only recourse. But before you do so, you should know some basics about the different kinds of bankruptcy that can be declared.

Chapter 7 Bankruptcy

Also called straight bankruptcy, the Chapter 7 bankruptcy is an option for debtors who have no significant assets to lose. With exception of exempt assets, all others are handed over to a bankruptcy trustee. The trustee liquidates these assets and distributes the proceeds among the various creditors in line with order of precedence. A period of 4 months usually elapses before the bankrupt debtor can claim to be discharged from all his debts.
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When Using a Debt Consolidation Service Makes Sense

If you are buried under a pile of minimum payments towards outstanding credit card balances, or personal or mortgage loans, then the surest way to dig yourself out of this financial predicament is to avail debt relief services. There are many companies that offer debt consolidation services and provide you relief from multiple debt problems. [Read more…]

How to Recover From a Large Amount of Debt or Bankruptcy

No matter how carefully you have planned your finances, you may still face a situation where you have to take a debt to meet an urgent need. But getting out of debt is not an easy task, especially if it’s a large debt like a mortgage. An unpaid debt weighs down on the borrower’s mind and keeps him or her from freely spending money even on expenses that are perfectly reasonable. But this may not be a bad thing after all. [Read more…]

Bad Economy Equals Layoff’s So Be Prepared

Companies had to cut down on their staff strength during the economic recession, because of which many Americans faced layoff during this period. The recession is now over and the employment market is picking up. But it is still advisable that you keep yourself prepared for the possibility of a layoff if your company is not doing too well. You do not want to be caught off guard if you are suddenly fired from your job. [Read more…]

Government’s Next Step to Pull U.S Out of the Recession

When Lehman Brothers announced bankruptcy and the economy went into a recession, the Fed did its best to avoid a 1930s like scenario. It pumped a lot of money into the economy to maintain liquidity and help businesses survive.

Now that the economy is recovering, the Fed will have to act in the opposite direction in order to control the surplus money in the system or we’ll have to face a period of high inflation. Several economists have emphasized the need for the Fed to act before it is too late. [Read more…]

Do Not Ignore Signs of Financial Trouble Act Quickly

People are often caught off guard by financial troubles as they are not prepared to handle them and they do not know how to react under such circumstances. Here are some useful tips for battling your financial problems.

Identify and analyze the problem

You will worsen your financial problems if you do not identify their source immediately. People often go in denial when they see signs of financial trouble. Unpaid bills, missed credit card payments and low savings are some of the common indicators of your worsening financial condition. You should not ignore your problem as you will just get used to that state and will only continue to make it worse. [Read more…]

Bankruptcies Spike in March

The National Bankruptcy Research Center recently released data that showed 149,268 personal bankruptcies filed in the month of March this year. The American Bankruptcy Institute points out that this figure is the highest ever since the Bankruptcy Code overhaul in 2005. [Read more…]

Number of Failed Banks Reaches 37 for 2010

Regulators have shut down seven more banks as the effect of bad loans on the financial industry continues. This has taken the total number of collapsed banks to 37 this year. [Read more…]

Is Your Inheritance Threatened If Your Spouse Files for Bankruptcy?

Asset protection can be a complicated financial and legal process whether you are married, separated or seeking divorce. It is important to be aware of the possible legal implications in case of a spouse filing for bankruptcy, while the other is due to receive an inheritance. [Read more…]

How Long Does Negative Information Remain on Your Credit Report?

This question haunts the mind of every person who had to go through a rough credit phase and is now stuck with a blemish on his or her credit report. Negative information or history of your bad credit, affects your credit score adversely. This could mean more expensive insurance premiums, higher interest rates on credit cards, loans and mortgages and in extreme cases even decline of credit line. [Read more…]

Bankruptcy Home Loan

The bankruptcy home loan has saved millions of people from losing their homes since the program is created as a safety net to avoid the complications of being penalized due to failure to comply with the previous loans. This kind of loan has been greatly utilized today considering the fact that recession has crippled the general public. When a client fails to pay, one can get evicted from their own home. [Read more…]

Bankruptcy Credit Repair

Bankruptcy may have been considered as a disease many years ago but nowadays, it is being treated as an ordinary phenomenon. You, your neighbor, or your friend may not be a businessman but the three of you are all bankrupt. [Read more…]