subject: Bankruptcy Information & Advice to Avoid Debt [print this page] Bankruptcy Information & Advice to Avoid Debt
If you are looking for bankruptcy information, you are likely dealing with a large amount of debt and want relief. However, most people do not need to declare bankruptcy in order to get help with their debt situation. It is important to understand what bankruptcy entails and to see what alternatives are available. Bankruptcy is an option that an individual or one of their creditors can ask the courts to declare. It means that you are no longer able to pay any or all of your debts. The petition goes to the insolvency court where they look at the situation and can declare you are bankrupt or not.
It is important to get both sides of bankruptcy information. There are advantages to bankruptcy. You get relief from all of your debt after the discharge. It is a good alternative for someone facing an overwhelming amount of financial baggage. It also provides your creditors with some amount of relief since your assets go out amongst them. Nevertheless, there are many serious disadvantages with bankruptcy as well. You lose all control over your assets. You can lose your home, your life insurance, and, in some case, your pension. You can stand to lose insurance settlements and inheritances as well. All of your bank accounts and credit cards go away. You find yourself denied credit for many years afterwards. Future employers and property owners may reject you due to the bankruptcy.
There are alternatives to bankruptcy available. One popular option is the Individual Voluntary Arrangement, or IVA. This is formal, legally binding agreement that you can attempt to get your creditors to agree to. If you can get 75% of your creditors to agree to the arrangement, you can have all of them bound by the agreement. You will need the help of an Insolvency Practitioner to get this started. You can try to get informal arrangements set up with each of your creditors as an alternative. However, these are not binding and often difficult to get in place. Use bankruptcy information wisely.
The best bankruptcy information you can get is to avoid it whenever possible. If you find that you feel overwhelmed with debt, step back and look at the situation. Are you spending more than you bring in each month? If so, cut back on expenses. Eat in more often. Put any savings towards bringing down the debt amount. Making fundamental changes will allow you to avoid bankruptcy and potentially to avoid debt in the future.
