There can be no doubt that bankruptcy is on the rise. More and more people and businesses simply cannot cope with the financial demands that they face. Unstable markets and currency, inflation and many other external factors contribute to this situation. When under tremendous pressure, many people start to think that bankruptcy is the only solution to their problems. However, when filing in terms of Chapter 11 Oakland applicants must make very sure that they are doing the right thing.
Bankruptcy is most certainly not a convenient loophole that can be used to escape financial obligations. It is a very strictly controlled process. The courts will not hear an application unless they are convinced that bankruptcy is the only solution still available to the applicant. To satisfy themselves in this regards, courts will examine all the records of the applicant and apply a strict means test.
Bankruptcy should always be the absolutely last resort. There are alternatives. Those in trouble should communicate with their creditors and try to negotiate more favourable payback schedules. In some cases they can even approach the court to order a review of they payback plans with their creditors. In many cases it is possible to obtain finance in order to consolidate all the debt.
It must be understood that the process of applying for bankruptcy can be lengthy and even humiliating. Every aspect of the lives of applicants will come under scrutiny. They will be required to declare all their financial dealings, their expenditure, their income and their assets. They will be obliged to allow access to every record pertaining to their financial status.
Once the court accepts a bankruptcy application, it will appoint a trustee to oversee the process. The trustee will focus on satisfying the demands of the creditors, not the needs of the applicant. He will attach the assets of the applicant and sell them in order to distribute money among the creditors. In the case of businesses he may decide to sell it, to strip it of its assets or even to continue its operations.
The court will finally issue a discharge when it is convinced that every effort has been made to reimburse the creditors. Once this is done, creditors may not make further demands on the applicant. This does not release the applicant from his obligations regarding tax, loans that were secured by assets, child support payments and fines. These obligations remain and must be honoured.
Because the process of applying for bankruptcy is so stressful and complex, it is better to leave matters in the hands of an experienced attorney that specialize in these cases. He can often negotiate more lenient terms from the trustee and he will guide his client throughout the process. He will also advise his client about alternative solutions before finally filing for bankruptcy.
Bankruptcy is not meant to serve as a loophole for irresponsible people and businesses. It is designed to help those that truly fall foul of circumstances outside their control. That is why the process is so lengthy and strict.
Bankruptcy is most certainly not a convenient loophole that can be used to escape financial obligations. It is a very strictly controlled process. The courts will not hear an application unless they are convinced that bankruptcy is the only solution still available to the applicant. To satisfy themselves in this regards, courts will examine all the records of the applicant and apply a strict means test.
Bankruptcy should always be the absolutely last resort. There are alternatives. Those in trouble should communicate with their creditors and try to negotiate more favourable payback schedules. In some cases they can even approach the court to order a review of they payback plans with their creditors. In many cases it is possible to obtain finance in order to consolidate all the debt.
It must be understood that the process of applying for bankruptcy can be lengthy and even humiliating. Every aspect of the lives of applicants will come under scrutiny. They will be required to declare all their financial dealings, their expenditure, their income and their assets. They will be obliged to allow access to every record pertaining to their financial status.
Once the court accepts a bankruptcy application, it will appoint a trustee to oversee the process. The trustee will focus on satisfying the demands of the creditors, not the needs of the applicant. He will attach the assets of the applicant and sell them in order to distribute money among the creditors. In the case of businesses he may decide to sell it, to strip it of its assets or even to continue its operations.
The court will finally issue a discharge when it is convinced that every effort has been made to reimburse the creditors. Once this is done, creditors may not make further demands on the applicant. This does not release the applicant from his obligations regarding tax, loans that were secured by assets, child support payments and fines. These obligations remain and must be honoured.
Because the process of applying for bankruptcy is so stressful and complex, it is better to leave matters in the hands of an experienced attorney that specialize in these cases. He can often negotiate more lenient terms from the trustee and he will guide his client throughout the process. He will also advise his client about alternative solutions before finally filing for bankruptcy.
Bankruptcy is not meant to serve as a loophole for irresponsible people and businesses. It is designed to help those that truly fall foul of circumstances outside their control. That is why the process is so lengthy and strict.
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