What Creditors Keep To Themselves

Generally the joy of creditors is to keep their debtors in the indebted positions with no apparent way out. However, in order to maintain you there they have to completely ignore some very vital information that could set one at liberty. The best solution they offer out of the indebtedness is paying.


Things creditors don’t want to mention


Bankruptcy can eliminate your debts or help you pay them off


Bankruptcy gives you the opportunity to eliminate debts or even to pay them off by developing a payment plan that works for you and your family.


Filing bankruptcy stops their calls

The law prohibits creditors from calling their debtors after they file for bankruptcy. Therefore the creditors wouldn’t mention to any of their debtors about this big secret. Before filling your bankruptcy claim consult dallas chapter 7 bankruptcy lawyers.


It can stop foreclosure

For anybody who might be behind in their mortgage payments, the bank wouldn’t disclose that filing for bankruptcy can stop the foreclosure proceedings. However, the creditors will always give the solution to it as bringing the current mortgage payments.


one won’t lose everything

People usually fear what they don’t know about. As long as the debtor is scared of losing everything they will keep making the mortgage payments. A fresh start under Missouri law is defined by exemptions. Exemptions outline the types of property and possessions that are necessary to have a fresh start without having to start over completely. The fact is that bankruptcy would deliver the freedom from the creditors.


One Will Still Be Able to Purchase a Home or a Car

Due to the hard economic situation that has forced people to live on credit cards, people will always do the best to build a good credit history. Therefore, many people filing for bankruptcy since they think that they might never get to purchase a home or a car. This is not true it’s not a must one Be Out of Work to File Bankruptcy.


As long as one can prove that their debt exceeds their expenses and they can’t afford to pay, they are eligible to file for bankruptcy. It’s a wrong notion that one must be out of job to file for bankruptcy.


One Can File Bankruptcy More Than Once

One may have the right to file again for bankruptcy depending on the timing of the previous bankruptcy. The benefit of file filing bankruptcy is the automatic stay that goes into effect immediately after filing. Traditionally, it gives an allowance of three to four months in order to Sort things out, even if the case doesn’t end in a discharge. It’s possible to be relieved again.


An Attorney might not be necessary

If one has a Chapter 7 bankruptcy, an attorney might not be necessary. This is referred to as filing “pro se”. Generally, the simpler the case is, the easier it is to file pro se. If it’s a complicated case or one intends to file a Chapter 13 bankruptcy, you will most certainly need the help of an attorney.

What Liquidation Means During A Bankruptcy

There is a huge difference between ‘bankruptcy’ and ‘liquidation’. To file bankruptcy means that the debtor is having difficulties paying off debt but is given a chance to pay them off, while still continuing to run a business, as in a Chapter 7 Bankruptcy.



However, when a company is liquidated, all operations come to a standstill. The assets are listed, including the office equipment, vehicles and furnishings and machinery, in the case of factories. The Debtors listing is drawn up with outstanding monies owed to the company and is collected in by the Department of Justice appointee.


Then the Creditors are contacted and they are invited to put in claims for their outstanding debts with the company. Either they will be paid out in order of priority, or they can seize goods to cover the amount. The secured loans will be paid out first. These will be any company that holds collateral on the loans. They can seize the collateral and sell it as recovery – usually, at below market value.


Then the unsecured loans are paid. These would include outstanding taxes, wages owed to employees and loans without collateral.


After all this, if there is still anything left, the shareholders will divvy out what is left. Generally, there won’t be. The Company is then declared ‘Liquidated’ and any debts still owing are written off.


Liquidation Test




When an individual or sole proprietor files a Chapter 13 Bankruptcy and the court is given a list of assets and liabilities, they perform a ‘liquidation’ test. This is an examination to see if your plan-of-action to pay off your creditors is being fair to the creditors, and if you actually can keep up with your proposed payment plan, over the following three to five years.


They compare it to a Chapter 7 Bankruptcy case, whereby your assets can be sold off to pay the creditors. If you don’t have sufficient assets, they will decline the Chapter 13 application and your company or the individual, will be put under liquidation.


In the case of an individual, even though the bank accounts will be frozen, and the home sold, there are instances when personal items can be retained like clothing, jewelry, a vehicle up to a certain value and pension funds.


Going into liquidation voluntarily is always preferable to having your company declared insolvent by the courts via your creditors. At least in this way, the director has full control of the dissolution of the business, with the help of an Insolvency Practitioner. Together, they can direct the way the assets are sold to recover capital and the business can be wound up in a less stressful manner.


Having compulsory liquidation could mean the director can be held personally liable, putting his personal assets on the line and he or other officers of the business could be charged with malfeasance, causing all sorts of distress and costs for a long time to come. Having that kind of charge on one’s record, means that getting future loans, opening another business or getting a mortgage, will be completely out of the question.


Being liquidated subsequent to declaring bankruptcy will save costs and reputations in the long run and will be less stressful all around.

9 Problems That Can Go Away When Filing Bankruptcy

Despite the bad reputation that is often been associated with bankruptcy, there is no doubt that bankruptcy is still the best option for most of your financial difficulties. Here are 9 out of many problems that can be solved when filing bankruptcy.



You could soon be facing foreclosure if you are behind on your mortgage payments. Filing bankruptcy (Chapter 13) can help you stop the foreclosure and assist you in structuring a payment plan that can help you meet up with your mortgage payments.



You car creditor has the legal backing to repossess your vehicle and even go ahead to sell it if you fall behind on your car payments. Filing for a Chapter 13 bankruptcy will either allow you to retrieve your repossessed car that has not yet been sold or stop the repossession efforts.


IRS taxes


Some older IRS taxes can be eliminated through bankruptcy with newer IRS tax debt. While freezing the high IRS interest and penalties, you can be allowed to repay the debt over a period of 3 – 5 years by filing bankruptcy.


Credit Card and Other Unsecured Debt

An abrupt end can be put to those never ending credit card payments if you file bankruptcy. Complete relief from these debts can be achieved in Chapter 7 if you qualify for a complete discharge of your credit card debt. However, depending on your monthly income and your ability to pay, you will be required to pay a portion of all your credit card debt through your repayment plan if you file Chapter 13 bankruptcy.


Medical Debt

Your finances can be severely affected by unforeseen accident or illness. To this effect, your savings or disposable income can be completely wiped out through payments on medical debts that have piled up so quickly. A great deal of debts owed for hospital stays, medical procedures, and bills can be eliminated through bankruptcy.


Collections Lawsuits, Judgments, and Garnishments

Bankruptcy filing will stop any collections lawsuits, garnishment or judgments. This also includes any student loan garnishments or IRS. Bankruptcy is the best answer to any paycheck that is garnished and as a result, there is not money to sustain life.


Harassing Phone Calls from Creditors

26a1Creditors may no longer be able to contact you by mail or by phone when you have filed bankruptcy. Evidently, they could face serious repercussions if by any means you are contacted after being discharged from bankruptcy, as it could lead to the payment of damages back to you.



Fraudulent Debt Negotiation Services

As a court-mandated and trustee managed process, bankruptcy allows you to either re-organize or discharge your debts. So, you are not at any risk of losing your money to a fraudulent debt settlement company since your creditors are obliged to participate.


Get Back On Your Financial Feet

You can achieve a fresh start from bankruptcy filing as it helps to reduce and eliminate unsecured debt payments and establish a new plan for you to catch up on your payments.