The decision to file bankruptcy isn’t one that should be taken lightly and it’s typically a last resort option that is used after trying other debt relief options. Bankruptcy can ruin credit, limit the ability to borrow and could result in the loss of valuable items. It can also impact the future financial goals of the person, like buying a car or home, obtaining a job and getting insurance. Financial advisors recommend exploring other debt relief options prior bankruptcy.
Chapter 7 bankruptcy involves liquidating assets in order to pay creditors. The good news is most people can keep their primary possessions, such as their house or a high-value car. Also, there’s a high chance that any court proceeding that has been initiated in relation to debts that are not paid will be stopped when someone is declared bankrupt.
In general, those who earn regular incomes may his explanation choose to choose to file Chapter 13 to create a plan to pay off their debts over three to five years. It is important to know that creditors will not take over your home, repossess your property or garnish your paycheck during this period.
With a robust and customizable bankruptcy processing solution such as Best Case by Stretto, loan servicers can automate bankruptcy notification, monitor changes to account data and enhance communication with attorneys. This powerful tool searches nationwide bankruptcy databases to discover changes automatically and inform clients of any changes. It helps minimize the risk of bankruptcy and eliminate unnecessary operating expenses.
