chapter 7 bankruptcy « Law and Advocacy

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Re-Establish Yourself Through Bankruptcy Loans

Bankruptcy is the dark side of a business and arranging for any kind of loan at this time is a real problem too. Before getting into the specifics of bankruptcy loan, let us understand how you can start preparing to apply for a loan.

It is very difficult to handle the financial situation after bankruptcy, but a loan can sort your problem to a great extent. It is true that many people who have suffered heavy losses due to bankruptcy think that it is the end of everything in this world. Even if you have filed for bankruptcy, it does not mean that the financial sufferings will never end. The real purpose of bankruptcy loan is to get you back onto your feet and offer you a way to survive through the mishap.

Through a bankruptcy loan you can plan again for survival in the market and re-establish yourself. This is an opportunity for you through which you can try to get back your home and automobile. This type of loan is given to those who have already stated bankruptcy, their bankruptcy cases have already been released by the court, and their creditors have also been compensated accordingly.

To apply for a loan after bankruptcy, one has to follow certain rules laid by the finance providers. In case you had filed for Chapter 7 bankruptcy, the debtors have to wait for at least for two years after filing for bankruptcy. On the other hand, in case of Chapter 13 bankruptcy law, the creditors need to be fully paid before you can apply for a bankruptcy loan; and only if you have cleared this picture of payment to the creditors, you can get the loan.

If you prove that right at the moment you are not the borrower who is at high-risk, you can easily apply for a loan without any doubt that your loan amount will be disapproved. Another effectual way of doing this is by re-establishing the credit amount by paying it back right on time and also maintaining a credit card successfully. Once this is done, you can request your credit company to provide you with a reference letter stating that you are responsible when it comes to paying on time.

Now, it is not true that only after bankruptcy you can get this type of loan. You can also apply for bankruptcy loan as a substitute for reimbursing the creditors at the time of bankruptcy. This has proved to be a disaster for almost all the financial institutions that offer loans to the companies because at the end the companies have to either go for another loan amount or the whole of the credit amount sinks. As the future of the companies who are on the verge of bankruptcy or are already bankrupt is very dicey, the finance providers need full assurance before offering loan to them.

What Are the Differences Between Chapter 7 and Chapter 13 Bankruptcy?

Being in debt can be a stressful, confusing, and often scary situation. It can feel like you are in a deep hole and all you want to do is climb out but creditors are continually throwing dirt down to bury you. Sometimes, the best option to get out from that hole and escape the wrath of creditors is by filing for bankruptcy.

Bankruptcy can be a confusing process if you are going at it alone and many people are unaware that there are different options available when filing. There are two classifications of bankruptcy that individuals can file for: chapter 7 and chapter 13.

Chapter 7 bankruptcy is referred to as a liquidation plan. In chapter 7 bankruptcy, debtors ask for the bankruptcy court to discharge most of the debts they owe in exchange for any property that is nonexempt from collection. There is no plan of repayment of debts as in chapter 13, however the debtors property that is collected by a trustee is sold with the proceeds used to pay creditors in accordance to Bankruptcy Code. Chapter 7 lasts about 3 1/2 months and you make no payments to the court during that time.

A common question people have who are considering a chapter 7 filing is in regards to the loss of property. Generally, if a debtors property is subject to liens and mortgages that pledge the property to other creditors, those pieces of property are going to be given up. The Bankruptcy Code, however, does allow the creditor to keep certain exempt property. It is important to realize that filing a petition under chapter 7 could result in the loss of property.

Chapter 13 is called the wage earner’s plan and allows people with a regular income to develop a plan for repayment of debt. Under Chapter 13, debtors propose a repayment plan to pay all or a portion of their debt over the period of three to five years, depending upon monthly income. So, under chapter 13 the time period is longer and debtors pay monthly payments to creditors similar to a debt consolidation plan, and the debtor does not give up any property.

While the differences are minimal, there are additional differences in the cost of filing. Chapter 7 charges $245 to file a case with a $39 administrative fee and a $15 trustee surcharge. Chapter 7 charges $235 to file a case with a $39 administrative fee.

Finally, there are differences in eligibility for chapter 7 and chapter 13. Many of these differences are based on net worth and an individual’s ability to pay back debts. The best way to find out more of these details is by contacting a competent bankruptcy lawyer.

If you are thinking about filing for bankruptcy in Louisiana, contact the Louisiana bankruptcy lawyers that focus exclusively on bankruptcy law, Kirkpatrick Bankrutcy Law. Every day, the attorneys at Kirkpatrick and Associates help people save their homes, their cars, and wipe out their debts from $5,000 to $300,000. No other law firm is better qualified to bring you the fastest debt relief, and do it right the first time. For a free consultation, call 504-828-3311 or visit www.kirkpatrickandassociates.com.