Bankruptcy - What Does that Entail?
By Lorna Mclaren
Bankruptcy is a reorganization bankruptcy. It means that
the people who decide to file for this type of bankruptcy
want to clear their debts over a period of three to five
Chapter 13 Bankruptcy appeals to those who have
non-exempt property that they want to keep hold of and
those who want to stop a foreclosure or repossession of
If the individual has sufficient income that is regular
and can pay for their day to day living expenses and have
something left over to repay their debt then they can
file Chapter 13 Bankruptcy. If their finances do not fall
into this category then they can not.
The person filing for bankruptcy should provide the court
with schedules of assets and liabilities and then within
certain time limits they have to file a repayment plan.
Once the repayment plan has been file in Chapter 13
Bankruptcy proceeding the creditors have a limited amount
of time to object to the plan. If no objections are made
then the debtors and their creditors are bound by the
Chapter 13 Bankruptcy will allow the debtors to keep a
property that he has failed to keep up mortgage payments
on even if it is secured. An "automatic stay"
is ordered by the court to prevent any foreclosure
proceedings to continue and the debtor then has the
opportunity to get caught up during the reorgnization
period. However, if this does not happen then the debtor
will be subject to the foreclosure at the end of the
If there is any secured property that has a value less
than the debt in question, Chapter 13 bankruptcy allows
for the return of the property to creditor. The creditor
can then sell the property and pocket the proceeds.
Secured debts are to be repaid first and then when they
are dealt with then non-secured debts will be repaid. In
Chapter 13 Bankruptcy any unpaid portion of non-secured
debts will be discharged after the period of
reorganization has passed.
Lorna Mclaren has an information
and resources website as
http://www.123-debt-consolidation-loans.com where you can
get more advice on types of bankruptcy.
Article Source: http://EzineArticles.com/