Bankruptcy Solutions – Why Bankruptcy Is The Last Resort

It is important to understand that bankruptcy should not be taken lightly. It is typically the last resort option after having tried other options for debt relief. The bankruptcy process can damage credit, make it difficult to access loans, and could result in the loss or valuable items. It also impacts future financial goals, such as buying a home or car or job and getting insurance. Financial advisors advise exploring other debt relief options before bankruptcy.

The most well-known type of bankruptcy is Chapter 7 which involves liquidating assets to pay creditors. The good news is that most people can keep certain essential items such as their home and expensive vehicles. Additionally any court action due to unpaid debts could be halted when a person is declared bankrupt.

Generally speaking, those with a regular incomes can opt to apply for Chapter 13 which allows them to devise a plan to pay off their debts over the course of three to five years. The good news is that it prevents creditors from attempting to foreclose or make garnishments on wages during this time.

With a complete and flexible bankruptcy processing solution like Best Case by Stretto, loan servicers can automate notification of bankruptcy, check for changes to account data and enhance communication with attorneys. This powerful tool searches vast bankruptcy databases across the country to automatically discover and notify clients of any changes. This helps them consumer and small business solutions minimize risk and avoid unnecessary operational expenses.

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