Understanding the Complexities of Bankruptcy Law

December 6th, 2020 by admin Leave a reply »

Bankruptcy law is perpetually evolving although the majority of of its rules and regulations are mostly not impacted by this constant stream of changes. Did you know that many states actually have their own individual bankruptcy laws in place? These laws assist to decipher the methods people file for bankruptcy, but if this is in conflict with the federal law then federal law takes priority. What this means to you is that you will not have any advantage if you file for bankruptcy in another state than the state in which you normally reside. In fact, most states do not permit you to file in a state other than the one you reside in.

Let’s take a good look at the current bankruptcy laws. The law consists of three main areas within which business and individuals are grouped. The Chapter 13 bankruptcy law is applicable to individuals with restricted resources with which to settle their existing debts and it would take them about three to five years to settle these debts.

Chapter 7 is a more extreme bankruptcy law. Under this law, the person needs to clear debts that would not be possible to pay off otherwise. This is much more serious than Chapter 13 as the process requires the individual’s assets to be liquidated in order to settle the existing financial obligations.

Nevertheless, the current bankruptcy laws require, despite the varied Chapters you can utilize to file for bankruptcy, that a number of financial obligations must be met and can’t be discharged when you file for bankruptcy. If your financial obligations fall under this heading then you would get little benefit by filing for bankruptcy as the current laws are going to make bankruptcy less of a possible option in helping you with your debts.

You must also look at the types of debt that you have, as there are particular types of debt that cannot be discharged via any chapter.

However, it’s a good idea to research as much as you can on the particulars of the current bankruptcy law so that you can learn how to put these laws to good use and to your advantage. However, this is frequently tougher than it seems and the bulk of consumers who file for bankruptcy will find the journey a long row to hoe.

Consequently, it probably makes a lot more sense to look for the help of a professional who is experienced and qualified in the area of bankruptcy law. This would normally be in the form of a bankruptcy attorney who specializes in this area and who will assist you in plotting the most appropriate course of action to fit your situation.

The fact is that filing for bankruptcy is a very drastic decision and it must only be considered after you have studied all other alternatives for paying or clearing your existing financial obligations.

You may also wish to consider using financial assistance from debt consolidation companies or receiving guidance from a debt specialist than automatically opting for bankruptcy. If these options have been researched to no avail then you must relinquish the reins to somebody who understands the complexities and consequences of filing for bankruptcy and the laws that govern the process.

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