There are many reasons why an increasing number of people find themselves in financial difficulties so severe that they can no longer pay their debts. The global economy remains unstable, inflation is high and retrenchments are increasing at an alarming rate. Anyone in such a situation is under severe pressure from their creditors and even from their own families. In some cases, an application for bankruptcy in Chicago can provide some relief.
The legal process that the courts follow when considering an application for insolvency can be slow and arduous. In many cases applicants must expect a waiting period of at least six months. This is because the courts have many factors to consider and because their are normally a number of parties involved in the application. The rights of every party has to be respected.
It is very important to understand that insolvency is not an easy route out of financial trouble. Firstly, the applicant will have to convincingly prove that he is utterly unable to honour his obligations. The court does nor focus on the hardship of the applicant, but rather on the rights of the creditors that are owed money by the applicant. Their rights are therefore the main priority.
Once a court agrees to consider an application in terms of Chapters 7 or 13, it will immediately appoint a trustee to oversee the process. The main priority of the trustee is to see to it that claimants receive what is due to them, or at least as large a percentage as possible. To this end he will sell the assets of the applicant at an open auction and liquidate all his investments and savings.
Applicants are often shocked to learn that insolvency does not absolve them from all their obligations. Secured debts are not written off. Child support payments will continue to be due and all taxes will still have to be paid. In many cases the applicant ends up with nothing but some furniture, sometimes his car and the means to make a living.
Nobody should attempt an insolvency application before obtaining advice from an experienced and reputable attorney. The long term consequences of insolvency can be devastating. Once an order is granted by the court the applicant will find it very difficult to obtain finance for at least ten years. He may be forced to make drastic life style changes and these changes will also be applicable to his family.
Any reputable lawyer will first try every possible avenue before filing for insolvency. Many creditors are willing to accept lower payments over extended pay back periods because they will at least be paid. The lawyer can even approach the court to enforce such arrangements. He can also help his client to draw up a realistic budget that will enable him to retain at least some quality of life whilst paying his debts.
It is most certainly not always possible to foresee serious financial problems. It is possible, however, to take action the very moment that such problems become apparent. It is vital to face the problems and to immediately obtain legal help. Taking immediate action can often help prevent disastrous long term consequences.
The legal process that the courts follow when considering an application for insolvency can be slow and arduous. In many cases applicants must expect a waiting period of at least six months. This is because the courts have many factors to consider and because their are normally a number of parties involved in the application. The rights of every party has to be respected.
It is very important to understand that insolvency is not an easy route out of financial trouble. Firstly, the applicant will have to convincingly prove that he is utterly unable to honour his obligations. The court does nor focus on the hardship of the applicant, but rather on the rights of the creditors that are owed money by the applicant. Their rights are therefore the main priority.
Once a court agrees to consider an application in terms of Chapters 7 or 13, it will immediately appoint a trustee to oversee the process. The main priority of the trustee is to see to it that claimants receive what is due to them, or at least as large a percentage as possible. To this end he will sell the assets of the applicant at an open auction and liquidate all his investments and savings.
Applicants are often shocked to learn that insolvency does not absolve them from all their obligations. Secured debts are not written off. Child support payments will continue to be due and all taxes will still have to be paid. In many cases the applicant ends up with nothing but some furniture, sometimes his car and the means to make a living.
Nobody should attempt an insolvency application before obtaining advice from an experienced and reputable attorney. The long term consequences of insolvency can be devastating. Once an order is granted by the court the applicant will find it very difficult to obtain finance for at least ten years. He may be forced to make drastic life style changes and these changes will also be applicable to his family.
Any reputable lawyer will first try every possible avenue before filing for insolvency. Many creditors are willing to accept lower payments over extended pay back periods because they will at least be paid. The lawyer can even approach the court to enforce such arrangements. He can also help his client to draw up a realistic budget that will enable him to retain at least some quality of life whilst paying his debts.
It is most certainly not always possible to foresee serious financial problems. It is possible, however, to take action the very moment that such problems become apparent. It is vital to face the problems and to immediately obtain legal help. Taking immediate action can often help prevent disastrous long term consequences.
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