Nearly everyone finds themselves in a financial jam every now and then. Unfortunately, some of these financial jams are a little harder to manage than others. Bankruptcy is arguably at the top of the list when talking about the subject of financial hardship. If you’re in a situation where filing for bankruptcy is becoming a probable choice, pay attention to the following information.
The one thing you should know is that bankruptcy isn’t for everyone. The millions who choose it often have a misconception about what it does. Bankruptcy is not the miracle solution to erase your debt and give you a financial fresh start. The bankruptcy move should only be attempted if you have insurmountable debt that is impossible to overcome given your financial situation. Bankruptcy isn’t for those who’ve taken out too many student loans and have decided not to pay them back. A KS Attorney in Topeka, KS may be able to review your case to see if this option is for you.
Bankruptcy is the ideal choice for those battling unsecured debt. Unsecured debt is debt which lenders have not received any collateral. In most cases, borrowers have to give something in order to secure a credit line or a loan. Unsecured debt gives lenders less rights when it comes to taking actions against those who default on their loans and credit cards. However, these lenders can take legal action in order to receive the money they’re owed. Bankruptcy courts are much more willing to accept this form of debt as opposed to secured debt. Unfortunately there’s still no guarantee that your claim will be accepted.
Secured debt is almost impossible to get rid of with bankruptcy. Most traditional loans offered by lenders are secured. These lenders want to make sure that they’re covered and secured in case something happens on your end of the agreement. This security gives them the right to go after your assets in order to pay off the debt you owe. A great example of this would be a mortgage lender. In this case, your home is the collateral, and if unfortunate circumstances should ever arise that cause you to default on your mortgage, your lender will foreclose on your home. Talk to a KS Attorney in Topeka, KS to get more advice on what debt can and can’t be handled.