By definition, bankruptcy is the lawful status of an individual or body that is not able to pay back the debts owed to the creditors. This state is usually summoned by a court order which is at instigated by the debtor.Bankruptcy filing involves the person or entity involved filing an application to the national court. The main aim of the declaration of bankruptcy is to take away the burden of those who are no longer able to pay the debts owed to them by those who had lend them.
Just like any other judicial process, one should be able to take time to think before coming to such conclusion. There are a number of factors that need to be taken into account. Despite the fact that it relieves a person off his duties to pay what he owed, there are also consequences that are involved.
To start with, employment opportunities are next to none. No one looks forward to employing someone who does not have money because they fear that such a person may end up stealing money from the company. Renting and buying houses becomes very hard and also one is not likely to get insurance services. In addition to that, there is stigma that is associated with such disclosure hence one ends up feeling ashamed of his financial status.
Seeking legal opinion is important as the attorney helps one determine which kind of bankruptcy to file for and takes the affected party through both the merits and the demerits of making such a decision. The involved lawyer also makes sure that the party has exhausted all possible means of paying the debt and this step should be the very last one.
Filing for bankruptcy may also lead one to own the property that was to be taken away by the creditors. The property is usually available in the form of fixtures like houses and vehicles. Cancellation of debts was the background of formulating such policies.
The client is supposed to hand in certain documents to the court so that the procedure may begin. The judiciary looks into these forms deeply and keenly. It is important to have an efficient legal adviser in this part whose main aim is to direct on when and how to present the paper work . In the event of a breach in any of the listed conditions, the application may be cancelled by the court.
The court then sends a notice of the insolvency filing to all the creditors that were written in the provided documents. This passes on a message to the creditors informing them that the affected individual has applied for protection and which chapter he has applied. This stops them from making any more advances to collecting the debt.
When the client is lucky in the court proceedings, there some cases where money that had been taken away from him for a period of ninety days before filing bankruptcy may be returned to him. Different courts offer different filing fees and the affected party should seek the guidance of a well trained and experienced attorney.
Just like any other judicial process, one should be able to take time to think before coming to such conclusion. There are a number of factors that need to be taken into account. Despite the fact that it relieves a person off his duties to pay what he owed, there are also consequences that are involved.
To start with, employment opportunities are next to none. No one looks forward to employing someone who does not have money because they fear that such a person may end up stealing money from the company. Renting and buying houses becomes very hard and also one is not likely to get insurance services. In addition to that, there is stigma that is associated with such disclosure hence one ends up feeling ashamed of his financial status.
Seeking legal opinion is important as the attorney helps one determine which kind of bankruptcy to file for and takes the affected party through both the merits and the demerits of making such a decision. The involved lawyer also makes sure that the party has exhausted all possible means of paying the debt and this step should be the very last one.
Filing for bankruptcy may also lead one to own the property that was to be taken away by the creditors. The property is usually available in the form of fixtures like houses and vehicles. Cancellation of debts was the background of formulating such policies.
The client is supposed to hand in certain documents to the court so that the procedure may begin. The judiciary looks into these forms deeply and keenly. It is important to have an efficient legal adviser in this part whose main aim is to direct on when and how to present the paper work . In the event of a breach in any of the listed conditions, the application may be cancelled by the court.
The court then sends a notice of the insolvency filing to all the creditors that were written in the provided documents. This passes on a message to the creditors informing them that the affected individual has applied for protection and which chapter he has applied. This stops them from making any more advances to collecting the debt.
When the client is lucky in the court proceedings, there some cases where money that had been taken away from him for a period of ninety days before filing bankruptcy may be returned to him. Different courts offer different filing fees and the affected party should seek the guidance of a well trained and experienced attorney.
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