Wednesday, December 15, 2010

Bankruptcy Basics

This post will discuss the fundamentals of bankruptcy.

The goal of bankruptcy is to settle debt that has become unable to be settled in it’s current form.

What is Bankruptcy?

Bankruptcy is a legal action available as a debt solution to those who have become overwhelmed with debt and financial hardship.

There are several types of Bankruptcies each with their own unique qualities, purposes, eligibility, guidelines, rules, cost, and proceedings. All of these different types and variables with in each type of Bankruptcy have and will change with time as new legislation and laws are introduced or modified. Also the proceedings and details of bankruptcy may differ from state to state.

Bankruptcy is an issue that should be discussed with a lawyer who is qualified.

Bankruptcy and Homeowners

Many homeowners have turned to bankruptcy in response to their financial hardship. Homeowners are able to use bankruptcy as a way to stop foreclosure.

Bankruptcy will stop any currently scheduled foreclosure sale of a property tied to the bankruptcy. Just the same most bankruptcies will only delay the inevitable and homeowners should use caution and take great care when considering bankruptcy.

Three Main Types of Bankruptcy

Chapter 7 Bankruptcy - This Chapter is often referred to as a liquidation Bankruptcy

Chapter 11 Bankruptcy - This type of Bankruptcy is often referred to as Business bankruptcy

Chapter 13 Bankruptcy - This Chapter of Bankruptcy is focused on restructuring the debt

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