Petition the court for the judicial declaration of bankruptcy is always the possibility that people not only to meet its obligations due to financial problems.
There are 2 types of bankruptcy, voluntary liquidation where the debtor's involuntary bankruptcy proceedings, and if the creditors have begun a process to protect its interests and promote their rights.
There are 2 types of voluntary> One of bankruptcy, is stored in Chapter 7 bankruptcy law, and others who have filed under Chapter 13 of the Act.
Chapter 7 bankruptcy is granted, apply to the liquidation of the debtor to sell their properties – at least those who are not exempt from the state – for administrators who will be the same and send the proceeds of unsecured creditors in proportion as they have served to debtor. Regardless of whether the destruction of propertywill be sufficient to meet these requirements will be rejected at the distribution of revenues. The debtor's financial life can start again from scratch.
Chapter 13 bankruptcy, on the other hand, works the same way, with one important difference. The debtor is required to satisfy a portion of their unsecured loans, which is the same as that of being rejected. This ratio depends on the court, taking into account the financial possibilities of the debtor in the nextThe future, no matter how poor it may seem to be in providing petition.
Immediately, one might think that Chapter 7 bankruptcy is a better choice.
Well, that is.
Unfortunately, can not be decided until the beginning of the debtor under Chapter Statute, should submit their request for judicial declaration of bankruptcy.
Law is clear on the matter. Firstly, taking into account the income of the applicant. If hisJunior high revenue, they will be able to file for bankruptcy under Chapter 7, but if your income is slightly above the average will be invited through a "means test."
This "means test" is its ability to repay its debts track, and how many of these bonds is true that in the situation. This will be the conditions under Chapter 13 of the Bankruptcy Act.
The passage above is a relatively new law to Congress in 2005.
DebtorIt is recommended to take advantage of services bankruptcy attorney to ensure that its interests are better protected. A lawyer is a petition against all attacks against his proposal, so at the end of the day can be declared bankrupt and defend their financial poverty will be reduced.
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