Five Major Reasons To File For Bankruptcy
A legal declaration that a person or business can't pay their debts is known as bankruptcy. There are many reasons why people would decide to declare bankruptcy, and here are some of the top causes:
1. Loss of a job - One of the most common reasons people choose to go bankrupt is because they lost their job. The current bad state of the economy has forced a lot of people to leave their work, and therefore leaving them unable to provide for themselves and their family. Losing a job may also mean losing insurance previously provided by their employer.
2. Medical bills - Sometimes, loss of insurance, a terrible accident or unexpected illnesses can be enough reason for a person to file for bankruptcy. Today, medical costs are really high and could pile up to inconceivable amounts. Filing for Chapter 7 Bankruptcy can greatly reduce or even completely eliminate these debts.
3. Preventing repossession of properties - If your home, car, or other highly valuable possession of yours is being repossessed, filing for Chapter 13 bankruptcy could force the creditor to return the aforementioned items to you. After this, your past missed payments will be consolidated into your bankruptcy plan. You will no longer pay to your creditors, but to your trustee instead. In turn, they will pay the finance company for you.
4. Stop home foreclosure and catch up on missed mortgage payments - Filing for Chapter 13 Bankruptcy won't get rid of your property mortgage, but it can stop foreclosure before sales or bidding can occur. It will then let you to repay your mortgage arrears, or the mortgage amount left.
5. Put a halt to creditors' harassing calls and behavior - Oftentimes, creditors tend to do debt collection in an unpleasant manner. Their abusive and oftentimes annoying behavior is very uncalled for, and in fact, unethical. Filing for bankruptcy can put a stop to the demands of many creditors, thus halting the many harassing phone calls and bad behavior.
There are many other reasons to file for bankruptcy. Of course, the best way to handle whatever bad financial situation is to consult a lawyer.
1. Loss of a job - One of the most common reasons people choose to go bankrupt is because they lost their job. The current bad state of the economy has forced a lot of people to leave their work, and therefore leaving them unable to provide for themselves and their family. Losing a job may also mean losing insurance previously provided by their employer.
2. Medical bills - Sometimes, loss of insurance, a terrible accident or unexpected illnesses can be enough reason for a person to file for bankruptcy. Today, medical costs are really high and could pile up to inconceivable amounts. Filing for Chapter 7 Bankruptcy can greatly reduce or even completely eliminate these debts.
3. Preventing repossession of properties - If your home, car, or other highly valuable possession of yours is being repossessed, filing for Chapter 13 bankruptcy could force the creditor to return the aforementioned items to you. After this, your past missed payments will be consolidated into your bankruptcy plan. You will no longer pay to your creditors, but to your trustee instead. In turn, they will pay the finance company for you.
4. Stop home foreclosure and catch up on missed mortgage payments - Filing for Chapter 13 Bankruptcy won't get rid of your property mortgage, but it can stop foreclosure before sales or bidding can occur. It will then let you to repay your mortgage arrears, or the mortgage amount left.
5. Put a halt to creditors' harassing calls and behavior - Oftentimes, creditors tend to do debt collection in an unpleasant manner. Their abusive and oftentimes annoying behavior is very uncalled for, and in fact, unethical. Filing for bankruptcy can put a stop to the demands of many creditors, thus halting the many harassing phone calls and bad behavior.
There are many other reasons to file for bankruptcy. Of course, the best way to handle whatever bad financial situation is to consult a lawyer.
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