Bankruptcy Solutions – Why Bankruptcy Is The Last Resort

The decision to file for bankruptcy isn’t one to be taken lightly and it’s usually a last-resort option that comes after attempting other debt relief solutions. The bankruptcy process can damage credit, restrict access to loans and may cause the loss of valuable possessions. It can also affect the future financial goals of the person, like buying a car or home, getting an insurance or job. Financial advisors recommend exploring other debt relief options before bankruptcy.

The most common type of bankruptcy is Chapter 7 which involves liquidating assets to pay off creditors. The good news is that a majority of people can keep their most important possessions like their home or high-value vehicle. In addition, any court action taken due to unpaid debts will likely be halted in the event that a person goes bankrupt.

In general, those with regular incomes are able to choose to file Chapter 13 to create a plan to pay off their debts over three his explanation to five years. The good news is that it prevents creditors from trying to foreclose or the wages of employees during this period.

With a comprehensive and configurable bankruptcy processing solution like Best Case by Stretto, loan service providers can automate notification of bankruptcy, keep track of changes to account information and improve communication with attorneys. This powerful tool searches comprehensive national bankruptcy databases to discover and notify clients of changes, helping them reduce risk and avoid unnecessary operational expenses.