Identity Theft Solutions

Bankruptcy, in its inititial years, was formulated for the benefit of lenders. This gave power to the creditor to seize all the property of the borrower to compensate for his loss. This scheme not only left the borrower broke but also caused him to serving imprisonment. However, the mechanism has been transformed a good deal with the passage of time. In modern times, bankruptcy is normally filed by a lender who admits his inability to repay his loans. This helps the debtor to easily re-organize his finances and attempt at partially repaying what he owes while continuing his business. The legislation that governs bankruptcy varies from country to country as well as from state to state. For example, in the US follows a Bankruptcy Code according to which there are six different kinds of bankruptcy called Chapters while Netherlands abides by the Dutch Bankruptcy Code. Again, Tampa Chapter 7, popularly called straight bankruptcy, and Tampa Chapter 13, also known as Wage Earner Bankruptcy, may have laws that are different from those followed in other states of the US.

When an individual files for Straight Bankruptcy, he or she is required to give up all assets that are free from taxes and other liabilities. The trustee handling the bankruptcy takes the proceeds from these assets and divides it among the creditors. This is how the debtor is relieved of a part of or the whole loan sum, as may be eligible aganst the proceeds derived from the surrendered assets. The US bankruptcy laws allow a citizen to file for this type of insolvency only once in every eight years. Post the amendment made in the year 2005, the applicant must also undergo a test to find out whether he or she is eligible to file for this bankruptcy. Inability to pass this test leads to the rejection of the bankruptcy application and at times recommends Wage Earner Bankruptcy to the applicant. It is necessary to be advised by a competent bankruptcy attorney for finding the best way to deal with this insolvency.

As the name suggests, Wage Earner Bankruptcy is aimed at those who have a steady flow of income. Under this type, the debtor is required to go for a repayment plan wherein the applicant chooses to pay off his debt with a portion of his income. Based on factors like income, expenditure, assets, etc., the repayment period can be anything between three years and five years. The tenure cannot cross the five years’ limit. In this case too the trustee plays an important role. Debtors pay the trustee who then hands over the money to the creditors involved. Again, in case of the debtor’s failure to pay, legal proceedings will act upon the trustee’s motion.

As is evident, it is important to hire a bankruptcy lawyer or attorney who possesses the necessary expertise and efficiency to handle your case. It is also essential that you maintain high amount of transparency with your advocate. Failing to comply could mean that you are committing strategic bankruptcy or even bankruptcy fraud, both of which can have adverse effects on your bankruptcy case.

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