There are several important points about bankruptcy Calgary residents should know about before they decide to file the necessary paperwork. While bankruptcies may have some advantages, there are also some disadvantages associated with it. Consumers should therefore look for sufficient information before hey decide to go on with the process.
Lenders are normally wary of people who have poor credit ratings. In fact, most banks never lend to people who have poor credit scores. Lenders are required to report defaulters and bankrupt individuals to credit reference bureaus. This can make it very difficult for a person to get employment, rental units and loans among other things.
Even if you are declared bankrupt, there are still some commitments that you will be required to honor. For instance, student loan debt, child support and alimony must be repaid as usual. Failure to do this will be considered contempt of court, which may land you in jail. There are several other debt obligations that must be honored regardless of your financial status, so it is important that you know them before you petition the courts to declare you bankrupt.
Some debtors qualify for the chapter 7 bankruptcy while others may qualify for the chapter 13. These two proceedings differ greatly with the chapter 13 requiring debtors to have a reliable source of income. It is the trustee who establishes whether or not a person qualifies for bankruptcy and which chapter is applicable in each case.
The chapter 7 calls for liquidation of assets in order to recover the money owed to creditors. Assets are divided into two, exempt and non-exempt. The court appoints a trustee to liquidate the assets and distribute the proceeds amongst all the creditors starting with the court and the government. All non-exempt assets are sold while the debtor is allowed to keep all exempt assets.
Consolidation of total debt is normally done in the chapter 13. Instead of liquidating assets, as is the case with the chapter 7, the trustee is required to help the debtor to come up with a sustainable repayment plan for the debt. Creditors may get only a portion of the outstanding balance but the repayment plan will fulfill all debt obligations that the debtor may have towards creditors.
An experienced attorney or a renowned business person can act as a trustee. The person should be impartial when making decisions. He or she is required to work with the creditors as well as the debtor to ensure a speedy settlement of the outstanding balance. Even though the trustee is mandated with the task of ensuring that creditors are paid, this does not meant that he or she should favor creditors.
There are many other factors about bankruptcy Calgary area residents should know about. While the internet might be a good source of information, talking to professionals is also a good idea. Experts in the field can provide competent counsel on the issue. For this reason, hiring the best attorney, financial adviser or debt counselor might be a good idea.
Lenders are normally wary of people who have poor credit ratings. In fact, most banks never lend to people who have poor credit scores. Lenders are required to report defaulters and bankrupt individuals to credit reference bureaus. This can make it very difficult for a person to get employment, rental units and loans among other things.
Even if you are declared bankrupt, there are still some commitments that you will be required to honor. For instance, student loan debt, child support and alimony must be repaid as usual. Failure to do this will be considered contempt of court, which may land you in jail. There are several other debt obligations that must be honored regardless of your financial status, so it is important that you know them before you petition the courts to declare you bankrupt.
Some debtors qualify for the chapter 7 bankruptcy while others may qualify for the chapter 13. These two proceedings differ greatly with the chapter 13 requiring debtors to have a reliable source of income. It is the trustee who establishes whether or not a person qualifies for bankruptcy and which chapter is applicable in each case.
The chapter 7 calls for liquidation of assets in order to recover the money owed to creditors. Assets are divided into two, exempt and non-exempt. The court appoints a trustee to liquidate the assets and distribute the proceeds amongst all the creditors starting with the court and the government. All non-exempt assets are sold while the debtor is allowed to keep all exempt assets.
Consolidation of total debt is normally done in the chapter 13. Instead of liquidating assets, as is the case with the chapter 7, the trustee is required to help the debtor to come up with a sustainable repayment plan for the debt. Creditors may get only a portion of the outstanding balance but the repayment plan will fulfill all debt obligations that the debtor may have towards creditors.
An experienced attorney or a renowned business person can act as a trustee. The person should be impartial when making decisions. He or she is required to work with the creditors as well as the debtor to ensure a speedy settlement of the outstanding balance. Even though the trustee is mandated with the task of ensuring that creditors are paid, this does not meant that he or she should favor creditors.
There are many other factors about bankruptcy Calgary area residents should know about. While the internet might be a good source of information, talking to professionals is also a good idea. Experts in the field can provide competent counsel on the issue. For this reason, hiring the best attorney, financial adviser or debt counselor might be a good idea.
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