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What You Need To Know About Bankruptcy

Short History
Bankruptcy came from the Italian words banca rotta which means “broken bench”.  It was also believed being derived from the mixed Latin words bancus which means “table or bench” and ruptus which means “broken”.
In the ancient times, if an individual could no longer pay for his debt, his family in its entirety including the servants that he owns will become debt slaves.  Some parts of the regions protect slaves from getting harmed physically and the maximum period of slavery may last up to five years.  This merciful act only benefits the family of the debtor but not their slaves who receive unpleasant and cruel treatment from the creditor.
Nowadays, a person or business can file bankruptcy depending on their financial status and in accordance to the law.  Such filing includes advantages and disadvantages which can be beneficial or harmful to the filer itself.  There will be an instance that they need to hire bankruptcy lawyer for help or handle it on their own meaning they are filing pro se.
What is Bankruptcy?
It is a legitimate status of an individual or business that has no more capability to pay the obligations he owes the creditors.  In most cases, it is established by the debtor and levied by the court.  All of the debtor’s possessions such as money, house, car or business undergo evaluation.  After being liquidated if preferred by the debtor, these are used to pay back a part of the current debt.  After the bankruptcy proceedings had been completed, the debtor is freed from any obligations regarding the debt.
A fresh start is given to a person or entity as their debts are forgiven which actually can no longer be paid.  Creditors agreed to have a payment in any kind according to their agreement in order to get a portion of the debt being paid instead of getting none at all.  
Getting help or advice from a business lawyer is highly recommended as bankruptcy involves a lot of consequences concerning legalities and long-term financing.  They will further explain to you what is bankruptcy all about, including its advantages and disadvantages.  Make sure that you hire an honest and credible lawyer. In case you cannot afford one, you will be provided a pro bono lawyer which means a lawyer that charges no fees.
·         Filing bankruptcy makes liabilities of older taxes of more than three years gone.
·         It prevents assertive collections from lenders.
·         It gives you a chance to have a new start as most state have declared exemptions to some of the things you possess to be spared.
·         Non-stop bothering phone calls from aggressive creditors or collectors are stopped.  Letters from creditors that demand payment and notice of credit cards cancelation as well as lawsuits have ceased.
·         It will ruin your credit score which makes it difficult for you to apply for a new credit.
·         Your student loan debt will not get rid of.
·         All of the credit cards you have will be gone.
·         Once you declare bankruptcy your identity will be published not only in the newspaper but will also be recorded in the court affecting your image and reputation.
·         There is a higher chance of not getting a new mortgage especially if you don’t have one before.

What You Need To Know About Bankruptcy Reviewed by Dex dela Cruz on 1:47 AM Rating: 5

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