The decision to file bankruptcy is not one that should be taken lightly and it’s typically a last resort option that is used after trying other debt relief options. The bankruptcy process damages credit, limits access to loans, and can cause the loss of valuable possessions. It also affects future financial goals such as purchasing an automobile or home, obtaining employment and getting insurance. Financial advisors recommend looking into other debt relief options prior bankruptcy.
The most well-known type of bankruptcy is Chapter 7 which involves liquidating assets to pay off creditors. The good thing is that most people can keep essential possessions such as their home and high-value vehicles. In addition, there’s a great chance that any court proceeding that has been initiated in relation to debts that are not paid is halted if the person is declared bankrupt.
Generally speaking, those with a regular incomes may choose to file for Chapter 13 which allows them to come https://brittandcatrett.com/2020/09/15/vdr-can-be-an-ideal-tool-to-help-small-business-owners-get-their-data-organized-for-various-purposes up with a plan to pay off their debts over a period of three to five years. The good thing is that it stops creditors from trying to foreclose, repossess or take wages as garnishments during this time.
Loan servicers that use an adjustable and comprehensive bankruptcy processing solution like Best Case by Stretto can automate bankruptcy notifications, monitor changes in account data and improve communication with attorneys. This powerful tool searches vast nationwide bankruptcy databases to automatically find and notify customers of changes, helping them reduce risk and avoid unnecessary operational expenses.