Bankruptcy Directory

Bankruptcy is a federal court process designed to help consumers and businesses eliminate their debts to repay, or is under the protection of bankruptcy court. Bankruptcies can generally be described as “liquidation” or “reorganization.” Chapter 7 bankruptcy is the liquidation variety – property is sold (liquidation) to pay most of your debt as possible while [...]

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After a bankruptcy filing, many people are reluctant to wade back into the world of credit, often because too much credit allowed them to build up the kind of debt that pushed them into filing for bankruptcy in the first place.

But, as many financial analysts note, rebuilding credit is an important part of recovering from personal bankruptcy. Here’s an outline of why and how to know if you’re ready to apply for a new credit card. For a more detailed look, check out this article from BankRate.com.

Credit after Bankruptcy?

Put simply, you need credit because in contemporary American life, your credit history plays a major role. Specifically:

• Housing: Many landlords check a person’s credit report before determining whether to rent to her. Theoretically, because a credit report includes a history of payment of various debts, it can give a landlord an idea of what kind of renter you’ll be (i.e. whether or not you’ll pay rent on time).
• Employment: It’s also common for employers to check the credit report of a potential employee. Some lawmakers are trying to see this practice changed, but for now you can expect a job application to include someone peeking at your credit report.
• Loans: This is perhaps the most important reason to reestablish credit. Whenever you apply for a loan (whether it’s a credit card, a mortgage or something between), the lender will check your credit. The terms of your loan will generally be based in large part on your credit score and the information in your credit report. Those with a strong history of paying loans on time are decent risks for lenders and so can be offered lower interest rates. And the reverse is also true.

But having no credit history at all means that potential landlords, employers or lenders would have no way to gauge what kind of risk you’d be to them, and so might deny you whatever it is you want.

When to Apply for a Credit Card

This depends largely on you and your financial habits. The BankRate.com article suggests considering these factors:

• How you’ll use it: The best way to use a credit card is to use it like cash. In other words, only buy with a card what you could afford with cash. That way, you can pay your bill in full at the end of each month. Cards grant you certain conveniences (like online shopping), not a license to spend.
• Why you filed for bankruptcy: If something unexpected like a divorce, death, illness or job loss led you to file, consider saving up about two months’ expenses before applying for a card. That way, if another emergency crops up, you won’t be tempted to run up a balance on your card.
• What card you’ll get: There are a lot of credit cards out there. Do plenty of research and find one that suits your needs. And if you can’t qualify for anything but cards with outlandish fees, wait a bit longer and try again.

View full post on site– The Bankruptcy Blog

Looking for a solution to the problem of credit card debt?
First of all, you can console that is being fought not only in the problem of credit card debt. Are hordes of people could be even worse credit card debt problem compared to you, they are all trying to eliminate the problem of credit card [...]

View full post on site– Texas Bankruptcy Notes

Failure usually means you can not use the loan for next seven to ten years. No matter how urgent, you should solve your problems without expecting anything from anyone. For people who are at various debts, bankruptcy is a last resort. Once you remove the bankruptcy, happy, you can still apply for the loan. But if you have enough bankruptcy information, you can repair your credit immediately recover from it.

One of the first things suggested by you is to look for files bankruptcy debt consolidation. Many companies offer loans as many ways debt consolidation can make good use of it. Using a debt consolidation loan helps you avoid bankruptcy. Of course, failure can close all your problems with your current creditors, but in the long run, is more relaxed as the tag remains on your own credit rating.

The information on bankruptcy, the second advice would be to go for an IVA. VAT experts is very good at understanding the design and implementation, then things. They can help negotiate with creditors so you can extend your repayment term, low doses of fresh and you can spend a few rate cuts. You can try this option before declaring bankruptcy.

But even after all this information into bankruptcy if it continues to go for bankruptcy, it is important that you get back to your normal state as soon as possible. For this, the first step you should take is to understand the current status of your credit. These will reflect the negative credit reports. Try to restore good credit. You can apply for most mortgage companies offer online loan money to people who were only failure. With the return of these new loans in time, you can help yourself to reach your financial situation normal. All the best!

Filing for bankruptcy may lead to a burden of mental and emotional person as the debtor’s credit history.

After declaring economic failure, you may have a difficult time re-apply for mortgages, loans, credit cards, insurance and a job, so you must prepare to rebuild your credit.

There are several types of bankruptcy, the two most commonly applied by many; Chapter 7 bankruptcy, which is a type of bankruptcy if the person in debt must petition the court to be discharged of all debts after the liquidation of all of the assets. A repayment schedule is negotiated with creditors as an alternative to liquidation of assets. Now, we deal more about this type of failure.

More often than not, the Chapter 11 bankruptcy has no limitation of amount of debt as opposed to Chapter 13.

Chapter 11 reorganization bankruptcy is called because a person may be able to propose a reorganization plan or return so they can continue its work, paying the debt.

Companies involved in this type of condition can trade more stocks. In contrast to those in Chapter 7 bankruptcy, the company no longer exists because all stocks will be liquidated.

Chapter 11 is almost certainly the most flexible of all funds, and yet the most difficult to generalize.

Bankruptcy Loans – We can restore your credit with time

A loan can give failure of the debtor to recover half of economic activity. In essence, the main purpose of filing a bankruptcy loan is for you to restore life and your finances again.

For Chapter 7 bankruptcy, the debt must wait two years after the bankruptcy was filed the application for a loan. The most effective way to repair your credit by paying all the bills for the specified time and keep your credit card and a good credit rating and reporting.

The last thing a person needs is to have the debt of another lender, while they are still buried in the responsibility. Under bankruptcy loans, we must be careful and cautious to read and understand all terms and conditions established by the company. In addition, we are willing to pay all debts, keep it tight budget, if you want to leave the tragic financial situation.

loans bankruptcy may actually serve life of the debtor after bankruptcy. Credit, loans, mortgages and can provide the perfect medium for an individual or company that might previously failed to restore their lending capacity.

What is Bankruptcy?

Bankruptcy is one of the more effective ways to deal with debts you cannot afford to pay. Once you declare that you are bankrupt, all assests in your possession will be used to pay your outstanding debts. After a period of one year, all your remaining debts will be written off and you can start anew. You can either file your own petition of bankruptcy or your creditors can do it for you. Either way, the effects are the same. Most of the Bankruptcy rules in effect have changed since April of 2004 when the Enterprise Act was approved.

How to go Bankrupt

Filing your bankruptcy petition

A petition for bankruptcy is readily available in your local County Court. Processing the petition may cost about £310 deposit and £150 court fee. These fees should be paid along with the submission of your petition. If you are on low income or on certain benefits, you can be awarded exemption from paying those fees.

Only the larger County Courts accept bankruptcy petitions. Although you are obtaining the form from your local County Court, you will need to take a trip to the High Court to submit the form. If, for example, you reside in central London, you will have to go to the High Court to submit your petition. The District Judge will usually call for a hearing that same day to decide whether it is appropriate to issue the order or not.

Once the order is made, you will get in touch with the Official Receiver who deals with your bankruptcy and report to him all your personal details. The information that you will be asked about usually pertains to your finances including your incomes, expenses, assets, Insurance policies, and Pension policy details.

A creditor making you bankrupt

Your creditor can file a petition for your bankruptcy if you owe him £750 or more, which you are not able to pay dutifully. If you have several creditors, they may join forces to file for your bankruptcy although this is rarely done. You can also be made bankrupt if your Individual Voluntary Agreement (IVA) fails.

Before a petition of bankruptcy is filed in court, your creditor will first send you a “Statutory Demand”, which will ask you to pay your debt either through installments or through the property you own.

The Statutory Demand is usually used by creditors to force its debtors pay the amount they owe immediately without any intention of filing for bankruptcy. This is because no amount is required for filing a Statutory Demand while filing for Bankruptcy charges fees upfront.

Within twenty-one days, the creditor and debtor must reach an agreement otherwise, a bankruptcy order may be filed in court. If your debt is less than £750 or there is an ongoing dispute about the money you owed, you can apply to have the Statutory Demand set aside.

ADVICE – Statutory Demands

Once you receive a Statutory Demand, your next move should be to check if you can have it set aside.

Do I have Assets?

Once you are declared bankrupt, the Official Receiver or appointed trustee may rule out to sell all your assets to pay for your debt.

INFORMATION – Please know that certain items or goods are not counted as assets. These items are basically your domestic needs such as clothing, bedding, furniture, and household equipment. Items that are necessary for you to carry over your profession or vocation are also not treated as available assets and in effect, cannot be taken away from you. Your antiques or expensive appliances can be given up for auction as well as your car so long as it is not needed in your profession. In some cases, a car that is necessary for employment is sold and is substituted by a cheaper one.

All your assets that have been discharged from your possession must be sold as soon as possible. If any of them remains after you have been released from bankruptcy, they will still no longer belong to you. The Official Receiver will continue to take possession of them until all of them have been sold.

INFORMATION – Assets

The only asset or valuable that is treated differently is your home. For details, see below.

Bankuptcy and Hire Purchase Agreements

A clause in the hire purchase agreement states that you will have to return the item once you are declared bankrupt. This means that your contract with the company will be terminated altogether. In some cases, however, you can be allowed to continue ownership by making payments dutifully even while you are declared bankrupt.

Pensions

If you went bankrupt before May 29, 2000, your personal pension could be taken in as an asset. This means that you will receive no lump sum or weekly payments in the future. This rule has been changed, however. Therefore, if you went bankrupt after May 29, 2000, your pension, may it be personal or occupational, should be left untouched. Some debtors used their pensions to stop creditors from taking away their savings. In this case, the pension fund may be lost to the Official Receiver.

Property and your home

A property or home is an asset that is treated differently. If it is yours alone, it can be forfeited to be sold regardless if it has any equity in it or none. If you are living in it with your spouse and your children, the sale will be delayed for a year to give them sufficient time to find somewhere else to live. Once you go bankrupt, your interest in your property is naturally transferred to the Official Receiver. If you co-own it or in some form of joint ownership, the Official Receiver should only take away your equity share. This is also known as your “Beneficial Interest”. In certain circumstances, you can be considered to have a beneficial interest even when you are not named in the mortgage. In certain circumstances as well, your co-owners can make an offer to the Official Receiver to buy out your equity share so the house will remain intact.

REMEMBER – Beneficial Interest

If your co-owners have any intention of buying out your equity share of the property, they must do it quickly. Otherwise, the Official Receiver may take it into his hands in selling your home altogether. Those who want to buy your beneficial interest must get in touch with your Official Receiver and transact with him directly. The Insolvency Service charges very low for the transfer of your beneficial interest so this should not really be a hard thing to manage. You also need to reach an agreement with your Official Receiver on the actual value of your beneficial interest before this kind of transaction is made. If there is negative equity in the property, the value of your beneficial interest may go from a minimal amount of £1. 00.

INFORMATION – Low cost conveyancing scheme

To avail of details about low cost conveyancing scheme, there is a leaflet entitled “What will happen to my home?” which are available in The Insolvency Service. You may also call National Debtline on telephone numbers 0808 808 4000 for more information.

If you fail to have someone buy out your beneficial interest in your home or property, your Official Receiver will have no other choice but to sell it. If your home has very little or no equity in it, the court will have to postpone the sale up to three years and see if your property has risen in value. Make an agreement with your Official Receiver about your beneficial interest to keep this scenario from happening.

If you still have mortgage or secured loan on your property, your monthly payments should be maintained to stop your lender from taking possession of your property.

New rules from April 2004

Before April 2004, the Official Receiver is allowed to come back at any time in the future to take your property and sell it. This has now changed. If you went bankrupt after April 2004, the Official Receiver is given only three years to deal with your property. If he is not able to sell it within the period, he will have to give your property back under your ownership. To counteract this law, the Official Receiver can either sell your home immediately, apply for an order for sale, or apply for a charge. If your Official Receiver applies for a charge, he will be given 12 years to ask for an order for sale.

Will I have to pay anything from my wages?

You may be asked to pay a specific amount from your earnings if the Official Receiver has proven that you have money to spare. He will think out your income and your expenses (including your mortgage, your rent, your household bills, and any other form of expenditures) and study whether you will have allowances for a monthly due.

Income Payments Orders & Income Payments Agreements

The Enterprise Act states that Bankruptcy orders expires after a period of one year. However, you may be asked to enter a binding agreement that will have you pay monthly fees from your earnings for three years under an income payments agreement. If your circumstances change at any period that the agreement is in effect, you can send a notice to your Official Receiver so your case will be looked at again. If you fail to pay your obligations, however, your Official Receiver will have the option to go to court and file for an income payments order against you. This way, the court will rule, based on the Official Receiver’s recommendations, how much you will need to pay for a period of three years.

The Effects of Bankruptcy

Once you went bankrupt, you will need to close your bank account or your building society account. You may open another one for as long as it has been agreed by your Official Receiver and that the bank or building society allows you to. That is why it is best to open an account when you are already discharged from bankruptcy.

INFORMATION – Instant access type accounts

Instant access type accounts may allow you work through a cash card. If you are interested to obtain more information regarding this, you get in touch with the National Debtline on 0808 808 4000.

Going bankrupt can affect your life greatly. In fact, the people that you are going to transact with will usually be more careful not to make you pay any amount that involves credits. If you live with a partner, you may transfer all your payable accounts under his name to make it easier for you and for the companies that you deal with — gas, electricity, and telephone companies.

Your employment status may also be at risk by going bankrupt. To be on the safe side, you must check your employment contract for any clause regarding bankruptcy. If you really want to be sure, you can ask the staff welfare officer or the trade union. If you belong in a professional body that prohibits bankruptcy then you must be prepared for your contract to be aborted. Any job that requires you to handle money could be at risk. Those who work in financial industry could even lose their consumer credit licenses once they go bankrupt.

Even after you are discharged from bankruptcy, you will still find it hard to obtain credits. Your credibility in handling financial obligations is obviously destroyed. This is because your record of bankruptcy will remain with credit reference agencies for a period of six years. Your bankruptcy status will also be kept detailed in the Insolvency Register for three months after you have been discharged from it. “The London Gazette” may also publish about your bankruptcy in its classified section or even in your local paper.

Bankruptcy offences

While you are on bankruptcy status, it is illegal to:

- Take a credit of more than £500 without your creditor knowing about your status.

- Use another business name to deceive people about your financial state.

- Act as a director of a company without permission.

- Act as an insolvency practitioner.

Bankruptcy restriction orders

Bankruptcy status should be lifted out exactly one year after it has been declared. That is in agreement with the Enterprise Act. Your Official Receiver, however, may petition for a Bankruptcy Restriction Order which can last between two and fifteen years, appearing on a public register, nevertheless. The grounds that may call for this order is your misbehavior and dishonesty in any way. If your Official Receiver feels that you have displayed “unfit” conduct, he can ask the court to issue the Bankruptcy Restriction Order. Breaking the order would mean a criminal offence.

Qualifications of an unfit conduct include:

- Deceiving the Official Receiver about your assets and businesses two years before you went bankrupt.

- Gambling.

- Making business transactions at a time when you know that you cannot handle debts.

- Taking out credits you cannot pay.

- Giving away your assets to avoid them from being taken away by the Official Receiver.

- Prioritizing some creditors over the others.

- Failure to cooperate with the Official Receiver.

- Concealing your assets and properties from the Official Receiver.

Being issued a Bankruptcy Restriction Order means that you cannot avail of credit that is more than £500 without letting your lender know about your status. You also cannot hold any significant position like an MP, a local councilor, a director of a company, or an insolvency practitioner until after the order has been lifted.

WARNING

The Bankruptcy Restriction Order does not stop your Official Receiver to take criminal actions against any of your offences. If you sell goods that you have on hire purchase agreement or you fill out false information on your loan application, your actions will be taken into account to the attention of the court, no less.

Discharge from Bankruptcy

The Enterprise Act of 2002 ruled out for discharge from bankruptcy after a period of one year. If you cooperate well enough with your Official Receiver and act to the best of your behavior, this can be moved earlier. A discharge from bankruptcy would mean that all your remaining debts even after your properties and assets have been sold will be written off so you can make a fresh start.

If, for example, you went bankrupt on April 1, 2004, you will be discharged from bankruptcy on April 1, 2005 unless it is about to end earlier.

WARNING

The rules on discharge from bankruptcy only applies to first timers. If you have had previous petitions for bankruptcy or your automatic discharge has been suspended, this may take long than you expected. Not keeping an amicable relationship with your Official Receiver could also lengthen your suffering.

If you want a certificate of your discharge, you may request the court to issue you one but this will cost £60. 00 on your purse. Also, if you want to apply to have your bankruptcy annulled, you may well do so for as long as all your financial obligations have been paid off.

Alternatives to Bankruptcy

Individual Voluntary Arrangements

An Individual Voluntary Arrangement or IVA is a formal agreement between the debtor and the County Court made to avoid a petition for bankruptcy. You can either set an amount to pay your creditors monthly and dutifully or pay them in full. To file for an IVA, you will need the help of an insolvency practitioner who will act as the middle man. It is usually costly to hire an insolvency practitioner. Asking them for an initial meeting where you can seek advice whether filing an IVA is appropriate in your case or not is best suited. This way, you can be sure that every cent you pay for is worth it. Names of local insolvency practitioners can be obtained through the court offices or the Official Receivers.

The insolvency practitioner prepares the proposal of payment scheme that is according to your capabilities. If your creditors agree to the terms stated in your IVA, the arrangement is put in place. If you fail to comply with the terms in your IVA for the period that it was in effect either your insolvency practitioner or your creditors could file a bankruptcy petition against you.

WARNING

Be wary about companies offering to put you on the line with an insolvency practitioner as this requires a fee. You can very well deal directly with an insolvency practioner without having to go through a third party.

FACTSHEET – Individual Voluntary Arrangements

If you need more information regarding Individual Voluntary Arrangements, you may get in touch with the National Debtline on 0808 808 4000.

Fast Track Individual Voluntary Arrangements (FTVA)

This is another alternative that you could sort through. The FTVA is used to have your existing bankruptcy annulled by way of submitting an installment plan to your creditors and hope against hope that they agree with it. This arrangement is much appealing to creditors because they could be paid more under FTVA than what they would under bankruptcy.

Instead of the insolvency practitioner, the Official Receiver works directly to put an FTVA in place. The FTVA is much cheaper than the IVA to arrange because the set fees and costs are lower. If you fail to adhere to the FTVA while it is in effect, your Official Receiver will have no other way than to make you go bankrupt again.

WARNING – Fast Track Individual Voluntary Arrangements

Weighing up the ways an FTVA could work for or against your advantage is important before tackling this road. If you choose to have an organization act on your behalf instead of the Official Receiver, you may want to consider a free debt management plan. This way, you can devise affordable repayment schedule for your unsecured debts.

COUNTY COURT FEES

DO I HAVE TO PAY A FEE FOR AN APPLICATION IN THE COUNTY COURT?

Every transaction with the County Court usually requires court fees. If you feel that you are incapacitated to pay the fees by way of benefits, you can submit an EX160 or the “Application for a fee exemption or remission” together with your main application. If the court agrees to your petition for exemption then you will not have to pay certain fees. If, however, you have paid a fee when you should have been exempted, you can file a petition for the court to waive or refund your paid amount. You can do this within six months after the payment has been made.

EXEMPTIONS

The court awards exemptions from paying fees to those deserving individuals who are on benefits. If you are on income support or income based job seekers’ allowance (JSA), you can automatically be awarded exemption. This is also the case with those who are on working tax credits. If you are on child tax credit or you have received the disability or severe disability element in your working tax, you can be eligible for exemption. This is considering your gross annual income taken into account for working tax credit is not more than £14,600.

To qualify for both, you must present substantial documents that will prove that you are on the above mentioned benefits. If your case does not fall under both, you can ask for your paid fee to be waived under the remission rule.

REMISSIONS

If the court fees will cause you “undue financial hardship”, you are qualified to file for remission, upon which your paid fee will be refunded. This can happen under exceptional circumstances that should prove you are not capable of shedding extra cash for your petitions. To apply for remission, you must present a list of your personal budget, your incomes and outgoings. You must present proofs that your current financial situation makes it impossible for you to pay the fee without having to go though “undue financial hardship. ” Upon studying your petition, the court may refund part or all of your paid fee depending on what it feels you can afford.