Bankruptcy is not something to jump into haphazardly. Chances are, if you are considering bankruptcy, you have considered every option possible to dig yourself out of debt. If you are thinking about filing for bankruptcy, you aren’t alone. Last year 1,074,225 individuals and families filed for bankruptcy in the United States.
A common misconception about bankruptcy is that it is a humiliating and miserable experience. However, many who experienced it tell a different story. Here are some benefits of filing for bankruptcy under Bankruptcy Code.
1) Bankruptcy restructures debt so it is manageable
The vast majority of people who file for bankruptcy genuinely desire to pay back their debts, they are just financially unable to. Full Article…
Bankruptcy legislation under US law was first introduced in 1898, by the enactment of The Bankruptcy Act. Thereafter, from time to time, there have been many acts and amendments to laws on bankruptcy in response to commercial and socio-economic demands. Petitions for bankruptcy, filed under chapters 7, 11 or 13 Bankruptcy have different implications.
By filing for a bankruptcy petition under Chapter 7, the petitioner hands himself to the protection of the court. It implies that the petitioner has no hope of ever being able to repay back his debts. The end result is a complete liquidation of the petitioner’s assets through a court appointed trustee, subject to exemptions, by way of sale to payback the creditors. Full Article…
The decision to file for chapter 13 bankruptcy is never an easy one, let alone deciding to go through the process without the aid of an experienced chapter 13 lawyer. If you must go through the process alone, there is a lot you will need to know. Everything involved in a bankruptcy is time sensitive, and those filing must adhere to various schedules and regulations. In this article, we will outline the process of filing for bankruptcy DIY style.
Step 1: Obtain the necessary forms pertaining to the filing of a chapter 13 bankruptcy. Each form is required to properly file. You can download forms online or obtain them through the courts, though many people simply opt to go the online route in order to save time. Full Article…
When a bankruptcy debtor inherits money from someone who dies within 180 days of the date the debtor filed bankruptcy that money becomes part of the debtor’s bankruptcy estate. The inherited money that becomes part of the bankruptcy estate is used to pay your creditors. This is true even if you have received a discharge and your Chapter 7 bankruptcy case has closed.
For instance, if you file a Chapter 7 bankruptcy on April 1, and your great aunt dies on September 28 (within 180 days of the bankruptcy filing date), any money you receive from your great aunt’s estate must be turned over to the bankruptcy trustee. It does not matter when you receive the money or when your case was discharged. You might receive the inheritance years later, and it must be turned over to the bankruptcy trustee for payment to creditors. You may be charged with bankruptcy fraud (a federal crime) if you fail to inform the trustee of your inheritance or turn over the money.
If the trustee receives inherited money, your case will be reopened and a bankruptcy estate is formed. Notices to creditors are sent and the trustee will distribute the funds to creditors. In some cases you will be able to keep some of the money, and in other cases some of the funds may be returned.
Inherited property is treated the same as cash. If you receive a car or a family heirloom, the property must be turned over to the trustee. In some cases you may be able to exempt inherited property or the trustee may consider the value of the inheritance too small or burdensome to liquidate and distribute.
If you are considering bankruptcy and are aware of a significant chance of someone leaving you inheritance money, speak with your attorney. There are options to avoid turnover including rewriting the will to cut you out, or setting up a spendthrift trust. A spendthrift trust cannot be reached by creditors. Consult with an attorney to properly create a spendthrift trust or rewrite a will. There is nothing illegal or immoral about estate planning and your loved one may prefer leaving money to you rather than your creditors.