Bankruptcy Options – Should You File Bankruptcy?
Bankruptcy is a way for people to reorganize their debts into a payment plan that can last three to five years. It can also help you keep some of your assets. Typically, creditors must stop collection efforts after you file chapter 13 bankruptcy. However, some employers may refuse to hire bankruptcy debtors, and it can take years to get your home loan discharged. Check it out here.
Chapter 7 bankruptcy
If you are considering a Chapter 7 bankruptcy, you may be wondering whether it is right for you. While this option does offer a clean slate, it will not wipe away all of your debt. The bankruptcy trustee will decide if you should keep your nonexempt property, which can include jewelry, equity in your home, or a car. However, most Chapter 7 cases do not include any nonexempt property. Also, some secured debts may require you to return your property or reaffirm the debt in order to qualify for a Chapter 7 bankruptcy.
If you’re concerned about the consequences of filing for Chapter 7 protection, you may want to consider hiring a bankruptcy attorney. This legal representative will be able to help you with any forms or paperwork that you may need to complete. A bankruptcy attorney will also be able to help you make sure that your case doesn’t get thrown out because of missing or incorrect paperwork.
In some cases, it may be necessary to choose a reaffirmation option over bankruptcy. This option can help people who need to keep their homes or cars and have secured debt. Basically, a reaffirmation keeps a lien on the property that was pledged as collateral. If the borrower cannot make payments on the secured debt, the lender may take the property and use it to make up the deficiency.
Reaffirmation agreements can help you keep your home or car, but you need to be aware of the terms of these agreements. Most of these reaffirmation agreements require some sort of payment from the debtor. If you are unsure of the terms of a reaffirmation agreement, make sure to contact the lender.
Before agreeing to a reaffirmation agreement, you need to make sure that your budget will accommodate the new agreement. Generally, a bankruptcy judge will only approve a reaffirmation agreement if it does not pose a substantial financial burden.
Tax liability relief
Tax liability relief in bankruptcy can be obtained by the debtor in a few different ways. One option is to file for bankruptcy before the tax debts are due and owing. This will give the trustee enough time to pay off creditors and reduce the amount of debt they owe. However, if the debts are more than three years old or have not been paid in full, the IRS may still collect the remaining balance.
Another option for taxpayers with large tax liabilities is an Offer in Compromise. This solution is available to people who are deemed insolvent by the IRS but have not filed for bankruptcy. It is based on the fact that a person cannot afford to pay off the entire debt in full without suffering an undue economic hardship. Those who qualify can be able to use mitigating circumstances to qualify for this option. Click for more info.