You have overdue debts and are you facing a difficult financial situation? You are not the only one. Today, many people face financial difficulties, and sometimes the only solution is to declare personal bankruptcy and avoid, even more, far-reaching consequences. Although this situation is not pleasant – sometimes declaring bankruptcy is still the best solution for those who find themselves in great financial difficulties. How much debt do you need to have to declare personal bankruptcy? We will try to find out the answer to this, and some other questions.
When And Why To Declare Personal Bankruptcy?
Unfortunately, today we have more and more people who remain in a difficult financial situation due to non-payment of their due obligations. It often happens that people almost overnight are completely left without any assets they have acquired over the years. Although this can sometimes seem difficult, and even harsh – banking and other financial obligations must be met. Is there a compromise solution that would satisfy both – debtors and banking and state institutions that are creditors to whom money is owed? Economic experts agree that declaring bankruptcy is still the best solution. Therefore, many people who are in need ask the same question: When and how can we declare bankruptcy and how much debt do we actually need to have to do so? This issue is quite complex and is influenced by various factors.
One thing is certain though. After completely emptying your wallet, your bankruptcy trustee comes. He will decide for you how to spend your money. Debt repayment can be made according to one of the established repayment models. According to one model, your trustee determines how much money you need for a living – and everything else goes to repaying debts.
What Type Of Bankruptcy Is Right For You?
If, after much deliberation or consultation with a financial advisor, you have concluded that declaring bankruptcy is the only way to get rid of debts – then you must decide on the type of bankruptcy that will be most appropriate in your situation. If you have personal debts or you’re a small business owner and your company has debts – the most common choices are Chapter 7, liquidation, or Chapter 13, that is, reorganization of bankruptcy. Think carefully before making a final decision. Not a small number of clients tried to reorganize their debts, but they did not succeed. In fact, sometimes, such an attempt can get you into additional trouble. Therefore, we will focus here on Chapter 7 – declaring bankruptcy and financial liquidation.
What Is Chapter 7 Bankruptcy?
For some people, chapter 7 bankruptcy may be a good option to get out of debt within a reasonable time. This can be a chance to get their lives back to normal financial flows. For many clients, it is a way to relieve the pressure that they constantly suffer from creditors, and they do not know how to solve the financial problems that have arisen. It is well known that the institution of personal bankruptcy, as a last resort, has long been developed in the West and the United States. However, many people are still not sufficiently versed in how they can declare bankruptcy – as well as how much debt they must have to do so.
Chapter 7 actually deals with the process of liquidation of assets and payment of debts. Although this procedure can seem drastic to you, it is often the best solution to finally get rid of accumulated debts – and get your life back to normal. According to attorneydebtfighters.com, to go through chapter 7 bankruptcy, you will need the help of a financial advisor to help you dispose of your assets in a way that you have enough to live on while at the same time getting rid of accumulated debts.
How Much Debt Do You Need To Have To Declare Chapter 7 Bankruptcy?
Most people who find themselves in a troubled financial situation are considering a possible bankruptcy declaration. However, everyone asks the same question: How much debt do you need to have to file for bankruptcy? Are there any limits on the amount of debt that can limit you in any way? The answer to this question is NO. Bankruptcy laws do not have limits on the minimum amount of your debt – but still, the amount you owe has a lot to do with the real possibility of declaring bankruptcy. So, we can say that in a way it does depend on the amount and circumstances in which a particular person finds himself at some point. Of course, you will not expect bankruptcy to be declared for the amount of, for example, 1000, 2000 dollars. However, for all significant amounts, you can expect permission to declare bankruptcy – and you will get your trustee.
What Is The Bankruptcy Trustee’s Job?
The institution of bankruptcy means that you get a trustee – so the whole process goes through that person. The bankruptcy trustee then actually disposes of the property. What does this mean in practice? This means that creditors cannot immediately seize your property due to debts. However, these assets are no longer at your disposal, but the bankruptcy trustee. He starts selling the property to settle the creditors – and that period depends on the amount of your debt as well as the property you own. However, some indicators suggest that debts can be resolved in this way even within just 90 days – and you can start financial normalization in a relatively short time. The idea is for you to get a new future chance, and to consolidate or restructure your finances in that period. In essence, by hiring a bankruptcy trustee, you stop being independent in finances, and you regain that right after you pay off your existing debt.
Salvation Or A Shortcut To Poverty?
This is the question that bothers most of those who are faced with this choice. In general, experts estimate that bankruptcy as a measure is a very complex matter that can sometimes be subject to abuse. So, you definitely need to be extra careful. In addition to the bankruptcy trustee who will dispose of your property – additional assistance from lawyers or financial experts is also recommended. It should be wind in your back so that you don’t become a victim of any kind of financial abuse.