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All About Personal BankruptcyLearn all about personal bankruptcy terms and how the process works before you even consider talking to an attorney or filing a bankruptcy petition. We answer your bankruptcy questions here. Doing so will help you immensely in understanding the conversation when consulting a bankruptcy attorney or get you on the right course should you choose to go it alone. All About Personal Bankruptcy TermsBankruptcy - This is a legal procedure filed under the appropriate chapter of the United States Code designed to deal with overwhelming debt problems of an individual or business. Bankruptcy Code - The portion of the United States Code that covers bankruptcy proceedings. This is the federal law that defines bankruptcy. Each state has additional laws that may apply to your case. Debtor - Someone who files a bankruptcy petition in court to get relief from debt. Chapter 7 - The section of bankruptcy code that provides for liquidation of assets. This means your non-exempt assets will be sold to pay off your debt. Chapter 13 - This section of the bankruptcy code gives individuals with regular income the opportunity to adjust their debts and repay them over a specified time period. Creditor - The person or entity to who claims to be owed money by the debtor. This could be your credit card or mortgage company, or other any other loan company. Consumer Debts - These are debts related to personal rather than business needs. Most likely to be credit card or other non-secured debt. Discharge of Debt - The release of the debtor from personal liability of a specific debt. Once a debt is discharged creditors can no longer communicate with debtor regarding this debt. Exempt Property - Certain property owed by the debtor specified in the Bankruptcy Code or applicable state law that prevents unsecured creditors access to the property. This varies from state to state. Nondischargeable Debt - This is debt that cannot be eliminated via a bankruptcy proceeding. They include a home mortgage, spousal support, child support, student loans, and certain taxes. Lien or Secured Creditor - The right of the lien holder or secured creditor to take or sell your property to pay back debt secured by the property. Houses and automobiles usually have an attached lien when a loan was taken for purchase. Statement of Financial Affairs - An official form to be filled out by a debtor as part of a bankruptcy filing. It will require full disclosure of income sources, any property transfers, any pending lawsuits by creditors, and more. |
It's all too easy to get into debt over your head.
No one enjoys that feeling of stress, anxiety, and fear that can come from having a mountain of debt. Don't lose hope. Getting out of debt is never easy, but it is achievable with a solid plan, and some discipline. Credit ReportUnderstanding your credit rating an important part of assessing your overall financial situation. If your credit rating is still good, it may change the debt reduction option you choose. If however, your credit rating is already ruined, you will likely be forced to choose a different route. Just keep in mind that a credit rating can be repaired over time, even following a banktuptcy. It's never too late to start working on a good credit rating. Get a free copy of your credit report each year so you can stay aware of your rating. |
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