Getting into a debt trap can be the most overwhelming situation for you where you will exhaust all the sources of funding and the best way to a deal with the situation is to file for bankruptcy. As an individual you will need to file for bankruptcy according to the present laws and you will also need to understand the terms and conditions to file bankruptcy. It is a legal term that determines that an individual or business is incompetent to repay the outstanding debts and this process starts with the filing of the petition by debtors.
This eventually leads to the measurement and evaluation of the data of the debtors so that it can be used for paying the portion of the outstanding debts. If you want to file for bankruptcy, you will need to undergo court proceedings where your assets and liabilities of an individual will be examined. This is especially important for paying the outstanding bills and liabilities and the court will also discharge the debts that do not find it feasible for payment by the bankrupt person. According to Bankruptcy Attorney Chip Vowell there are certain terms and conditions that have to be followed to file bankruptcy
Terms and conditions to file bankruptcy
When filing for bankruptcy, it is important to take into account the terms and conditions of the bankruptcy law so that you will get assistance when your finances collapsed. Moreover, it also offers you the opportunity of starting your life afresh so that you can decide on the kind of investments that you need to make for achieving a financially secure future. There are two kinds of personal bankruptcy that you will need to consider and it includes filing of bankruptcy according to chapter 7 and chapter 13. While chapter 7 will allow you to get rid of your debt entirely and this is the best option for individuals with low income and high debt amount. But chapter 13 is a bankruptcy method where the debtor has the option of repaying a part or entire amount of debt over a period of 3 to 5 years according to the plan that has been drafted by the court. The terms and conditions to file bankruptcy involve knowing the eligibility criteria of filing for either chapter 7 or chapter 13 of bankruptcy. The conditions also include knowing the debts that should be discharged prior to the other kinds of bankruptcy and the procedure for discharging of the debts.
As an individual debtor, you will need to select from both the kind of bankruptcy and you will also need to liquidate the non-exempt assets for paying the proceeds to the creditors. Both the kind of bankruptcy comes with different eligibility requirements and you will need to pay attention to the terms and conditions of the bankruptcy. The creditors will get the amount of debt after the assets of the debtors have been liquidated so that they will get repayment from the bankrupt person. After completion of the bankruptcy proceedings, the debtors will get relief from the debt obligations that has arise after the filing of the individual bankruptcy. The entire process will be in accordance with the state laws and you will get complete peace of mind after the completion of the bankruptcy process.