How to Bankruptcy / Manage debts ~ Eliminate debt ~ Options ~ Filing for bankruptcy

If you are overwhelmed by stacks of bills and cannot honestly cope with them, don't despair.

Instructions

Difficulty: Moderately Challenging

1. You must file forms with the clerk of a u.s. bankruptcy court and pay a fee. When a person files for bankruptcy, the Federal court grants an "automatic stay." This prevents creditors from attempting to collect on any outstanding debts.
2. You can choose between two types of bankruptcy:
   1)LIQUIDATION (Chapter7)
   Under liquidation, all your property is sold except for certain things deemed necessary for a reasonable life-style and for your work. A trustee handles the sale and sees that your creditors receive their fair shares of the proceeds. You are no longer responsible for those bills, whether your creditors are paid in full or receive only a fraction of what you owe.
3. 2)Rehabilitation (Chapter 13)
   Under rehabilitation, you need only reach an agreement with your creditors to repay your debts up to a certain amount on a monthly timetable.
   Credit bureaus can report either type of bankruptcy for up to ten years, but lenders generally think better of a creditor who pays off his debts rather than liquidating them.
4. (Chapter 11 ) Used when the owner desires to stay in business, restructure existing debts, retain assets, and attempt to reorganize under court supervision.

Tips & Warnings

• Bankruptcy offers legal help,providing you haven't used it in the past 6 years.
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