The decision to file bankruptcy isn’t one that should be taken lightly. It’s usually a last-resort option that comes after attempting other debt relief solutions. The bankruptcy process can damage credit, restrict access to loans, and can result in the loss of https://brittandcatrett.com/2022/01/04/risk-management-and-small-business valuable items. It also affects future financial goals like buying cars or homes or obtaining a job, as well as getting insurance. Financial advisors recommend looking into other debt relief options prior bankruptcy.
The most well-known type of bankruptcy is Chapter 7 which involves liquidating assets to pay off creditors. The good thing is that many people can keep their essential items, such as their home or expensive vehicle. In addition, any court action taken in relation to unpaid bills will likely be stopped when a person is declared bankrupt.
In general, individuals with regular incomes are able to choose to file Chapter 13 to create a plan to pay off debts in three to five years. It’s good to know that creditors cannot be able to foreclose on the property you live in, or take possession of it. property or garnish your paycheck during this period.
With a complete and flexible bankruptcy processing solution such as Best Case by Stretto, loan service providers can automate notification of bankruptcy, monitor changes to account information and improve communication with attorneys. This powerful tool searches across the nation’s bankruptcy databases to detect changes automatically and inform clients. It helps reduce risk and reduce unnecessary operating costs.