Bankruptcy-revisitedBankruptcy-Revisited [The article below relates to the position in the USA, but, nevertheless, if you live in the UK... please click on the link to the website which is at the bottom of this article as there are some extremely useful links for UK citizens available too.] Bankruptcy-revisited...
Filing for bankruptcy will no longer be an easy option Most of us already are aware that the change in the bankruptcy law will be effective this October. Those who are already in debt argue that it is unfair. Companies that have suffered profit loss through the years are relieved to hear the news. The change in the bankruptcy law will force individuals who are in debt or facing debt to file for Chapter 13 bankruptcy. The old way of just erasing debt will no longer be an option to most. How does Chapter 13 bankruptcy work? Well it is a plan that arranges monthly payments of the debtor. The courts calculate what amounts the individual can pay on a monthly basis. Chapter 13 is available to anyone who has some kind of steady income allowing them to come up with money to pay off their debts. It does prevent the debtor from the need to liquidate any of their available assets. The individual does not decide what they can pay and when they can pay it off. The courts will calculate the payment arrangements and the time line in which the debts are to be paid off. Now that there is a new bankruptcy law people should plan better for the future to prevent their need to file as bankrupt. One very important thing is to never live outside your own means. If you have credit cards don't use them as if you will have the money every month to pay the minimum balance. Be prepared for the unexpected such as a loss of your job or loss of any other source of income. This is where some people get into trouble. Protect yourself and your assets by being insured. Some people get into debt due to unexpected medical expenses or property damage. When you don't have a way to help cover these expenses you will find your self in some kind of debt. Try and keep some money off to the side in case some kind of unplanned expense should arise. Have some kind of back up plan to avoid the need for bankruptcy. Especially to those who did all they could from falling into debt. We can not turn back the hands of time and erase the decisions that were made by our government. Regardless of your situation we most pay the same price caused by those who abused bankruptcy in the past. The best step we can take is to be prepared for all financial circumstances. Make a back up plan of your own and never have the need to even consider bankruptcy.
Kevin Heaps is the owner of
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