ALL >> Business >> View Article
Is Bankruptcy An Answer?
In these difficult times, many people are having serious financial troubles. Many are in the real estate industry and are experiencing a dramatic loss in income. Some are real estate investors who purchased rental homes that are no longer cash flowing and are “upside down” i.e., have negative equity. Many others are just average people whose entire life savings is in danger because they were lured into an exotic mortgage that they cannot afford and a home they cannot sell. So what can they do? Is bankruptcy the answer?
One of the reasons why people dislike bankruptcy attorneys and most attorneys in general, is because we often use words like “probably” “maybe” or “it depends.” We apologize in advance, but the answer really does depend on the particular circumstances of the people involved. In short, bankruptcy is a great solution for people that have lots of unsecured debt. The most common form of unsecured debt is credit cards. Therefore, if a person has average income, little savings, and lots of credit card debt they are an ideal candidate for bankruptcy. Bankruptcy can relieve all the unsecured debt ...
... giving the client a fresh start.
On the other hand, bankruptcy is often not a good solution for those who have little unsecured debt and a lot of secured debt. Secured debts are loans that are secured by property, like cars or homes. Under the bankruptcy laws, secured loans must be paid or the creditors are free to take back the property. Therefore, if a person has no credit card debt but owns fourteen investment properties that are “upside down”, they are probably not a good candidate for bankruptcy.
Of course in real life, folks do not always fit neatly into one of these bankruptcy categories or the other. A person may earn a good income and have built up a good savings, but also may have some credit card debt and own three homes that are “upside down.” In this circumstance, the client needs to determine the consequences of letting some/all of the homes go into foreclosure. If a person is protected by the anti-deficiency statutes, they might just let the homes foreclose without any need to file bankruptcy. Alternatively, if the person may be personally liable for hundreds of thousands dollars of mortgage debt after the foreclosure, bankruptcy may be a solution because after a foreclosure the mortgage debt becomes unsecured.
After a person sits down with an Arizona Bankruptcy lawyer and determines all of the client’s liabilities for the debt on the homes, then client and the attorney can then evaluate whether bankruptcy is appropriate under the circumstances.
Article Source: Combs Law Group
Add Comment
Business Articles
1. Unveiling The Material Characteristics Of Plastic PartsAuthor: adam.xu
2. Top 5 Beach View Resorts In Chennai For A Memorable Getaway
Author: greenmeadows resort
3. Relationship Counselling Den Haag Brings The Best Chance To Understand Each Other’s Needs!
Author: Angelika Matthias
4. Web Development Company: Guide For Hiring The Best
Author: Sagar Tech
5. Make A Business Website To Get Started Online
Author: Sagar Tech
6. Elevate Your Software Quality With Agile Advisors: Premier Software Testing Consultancy In Dubai, Uae
Author: kohan
7. Affordable Polyester Pleated Mesh From Top Manufacturers
Author: pavitra
8. Empowering Sustainable Development: Agile Advisors As Your Trusted Leed Certification Consultant In Dubai And Uae
Author: kohan
9. Buy Cats Eye Gemstone Online In Ahmedabad
Author: rishabhjains
10. Why Data Destruction And Sanitisation Are Important
Author: Destruction and Sanitisation
11. Stock Market Update: शेयर बाजार में लगातार चौथे हफ्ते बढ़त: क्या तेजी बरकरार रहेगी? जाने इस हफ्ते किन महत्वपूर्ण पहलुओं पर ध्यान देना चाहिए
Author: M Ratlami
12. Perfect Happy New Year Gift For Your Girlfriend Thoughtful Ideas For 2024
Author: MyFlowerTree
13. China Valmax Valve Co., Ltd
Author: China Valmax Valve Co., Ltd.
14. Mastering Clipping Path In Photoshop: A Guide To Precision Editing
Author: Sam
15. Expert Emergency And Cosmetic Dental Care Services For Families And Individuals In St. Louis
Author: Jessica Williams