With the growing trend of taking various kinds of loans to meet the needs of high standard living, more and more people in America now have trapped themselves into the nasty pile of various kinds of debts. Sometimes, the debts become so high that they start controlling you instead of you controlling them. This is where the legal expertise of a bankruptcy attorney emerges as the only solution that can bring you the much-desired relief from the heavy burden of debts.
What Are Personal Bankruptcy Laws?
The personal bankruptcy laws are the legal provisions that allow an individual to settle the debts they owe on much easier terms that fall within the means available to them. An honest individual can take advantage of the personal bankruptcy laws to give a fresh start to their financial life.
Ways To Use Personal Bankruptcy
There are two ways to use Bankruptcy services – voluntary and involuntary. As the term suggests, the voluntary personal bankruptcy is the procedure where the debtors himself or herself is filing bankruptcy petition. On the other hand, sometimes creditors in an effort to get their money back file a petition for bankruptcy against the debtors. If you are deeply drowned into debts and unable to think out a way to get out of this nasty situation, you had better file for personal bankruptcy yourself. Do not wait your creditors to file it for you because that will eventually maximize your trouble.
Advantages Of Filing Personal Bankruptcy
Those who are trapped in heavy piles of debts with all doors closed to pay off the debts can take advantage of the personal bankruptcy services. When you file a petition for bankruptcy, an automatic stay is legally imposed. This legal stay will save you from further harassments from your creditors to make payment. During the time while your personal bankruptcy is under trial, your creditors will not be able to take any non-bankruptcy actions that may include compelling you to make payments, etc. After you are declared as bankrupt, you can get relief from all your debts by settling them with your “non-exempt” resources and assets. This way, by filing bankruptcy, you get dual protection. While the bankruptcy case is pending, you get protection from the legal stay and after the bankruptcy is declared to you, you can easily release yourself from all kinds of financial responsibilities. Now you will have to start afresh.
Personal Bankruptcy For People With Regular Source Of Income
As per the bankruptcy laws, if you are among those who have a regular source of income, you cannot apply for liquidation bankruptcy. You will have to act according to the Chapter 13 Personal Bankruptcy law. As per this chapter, the court will propose you a repayment plan to pay off the reduced claims by the creditors. For example, you may want to pay 15 cents on each dollar and after the bankruptcy proceedings the court orders you to pay 25 cents on each dollar.
This way, your debts will be reduced to a very little amount. Now you will be liable to pay this amount of debt on a monthly schedule basis, as proposed by the court.