Bankruptcy Basics
By Heather Faucher | Posted on September 16, 2009 | Filed Under Bankruptcy
Bankruptcy was created to benefit both debtors (consumers or businesses who owe money to others) and their creditors (a person or business who is owed money) by making sure that debtors get relief from debts that they truly can’t afford to pay, as well as ensuring that creditors get paid from any assets that the creditor doesn’t need to live on. In 2005, the U.S. Bankruptcy Code was modified to make it more difficult for debtors who can afford to pay off at least some of their debts to file for Chapter 7 bankruptcy, which forgives most if not all of a consumer’s debt. Instead, most of these debtors are required to file for Chapter 13 bankruptcy, under which they re-pay most or all of their debts under a 3 to 5 year payment plan.
So, how do you know whether you’ll need to file for Chapter 7 bankruptcy or Chapter 13? Read more
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Tags: backruptcy discharge, Bankruptcy, Chapter 13, Chapter 7, filing bankruptcy
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