2013 What Happens When You File Bankruptcy – 2013

what happens when you file bankruptcy

After you have made the decision that bankruptcy is your only way out, you must be aware that filing bankruptcy is a very detailed process and one you must be right on about in order to make it to the other side of financial beginnings. There is a strict time limit that must be met in order to get your bankruptcy filed properly to the courts. The very first step you will be advised to follow is to visit a credit counselor privately or within a group to both learn about bankruptcy and learn how it could or may be avoided.

The second step is to file a petition with the bankruptcy courts within the area you live in. You will be offered to pay the legal fees in installment or in some rare, extreme cases these fees will be waived. This is the decision of the court and every bankruptcy case is different and treated this way. Many people have been under the impression that there is a standard and generic way to handle bankruptcy filings, when in fact every bankruptcy case is unique in their different circumstances.

The court will then review all your creditor documents and debts and make their decision as to how to go about paying back these debts. Often times the court will hold a meeting with the main people you owe money to and try to come to an agreement to solve the problem. This is where many people learn they have believed a myth. It is a common misconception to believe that the people you owe never get their money and therefore creating enemies. The truth is that your debts will get settled and people will understand that financial problems occur.

Lastly, your case will be determined to be an “asset” or a “non-asset”. When the court deems your case to be a non-asset your involvement in the case is over unless something unexpected occurs which is very rare.

On the other hand if your case is deemed an asset this means the court will sell your home and any other assets you have in your name in order to pay off your debts. This can be a very painful process for the person filing to see their items being sold off but in some cases this is not the only option. This is why so many professional urge people to speak with financial professionals before making rash decisions. There are many bankruptcy rules and the professionals know how to use them to your advantage.

Understanding this process is essential to your financial success. You of course do not have to learn the bankruptcy laws as well as professionals but a general understanding is quite beneficial. Bankruptcy is a serious financial step in anyone’s life and can be recovered from when you take each step properly and complete it fully. Go see a financial professional today and learn what your options are before it is too late.

(PRWEB) July 19, 2013

The city of Detroit filed the largest municipal bankruptcy case in U.S. history Thursday afternoon. Gov. Rick Snyder (R) filed the 16-page Chapter 9 petition in U.S. Bankruptcy Court in Detroit.

The following statements from budget and tax experts at The Heartland Institute a free-market think tank may be used for attribution. For more comments, refer to the contact information below. To book a Heartland guest on your program, please contact Director of Communications Jim Lakely at jlakely(at)heartland(dot)org and 312/377-4000 or (cell) 312/731-9364.

Intransigent police, firefighter, and teacher unions delivered the final, death blow to the city of Detroit. But other major cities have been able to deal with such intransigence without having to resort to bankruptcy. What ultimately killed Detroit was its culture of dependence and victimization – the same culture that elected and re-elected our President and which threatens to destroy the entire nation. The city always and invariably blames its shortcomings on everyone but themselves – on inadequate federal and state subsidies and on the racism of those who identify, quite correctly, those policies as the cause, rather than the solution for the cities downward spiral.

Going forward, Detroit should follow the example of Wisconsins Scott Walker, who first as Milwaukee County Executive and then as the states governor, took on the unions, promoting privatization and extending school choice that was instituted by former Governor Tommy Thompson. But that will not be enough. Detroit must embrace the wisdom of the immortal Pogo: We have met the enemy and he is us. Individual responsibility and self-reliance must become the motto and watchword of every politician and citizen. When it does, the sky will be the limit for Detroit.

Thomas Walton, Ph.D.

Director, Economic Policy Analysis

General Motors (retired)

media(at)heartland(dot)org

312/377-4000

Thomas Walton worked in Detroit for 33 years as an economist at General Motors.

Detroit is the largest city to declare bankruptcy, but it wont be the last. Cities like Detroit have relied on property taxes to support bloated spending for too long. Instead of making promises to employees and building projects they cannot afford, cities should make long term plans that embrace a competitive tax structure that functions reliably in good times and bad. One solution that should not be considered is a federal bailout, throwing taxpayer dollars pulled from around the country to prop up a thoroughly broken and mismanaged system is not only irresponsible, but a complete waste of money.

The primary issue Detroit faces, unaffordable public pensions, is a serious problem, but solutions do exist. In the short term, per-year pension payouts should be capped at a sensible level, the retirement age should be raised, double-dipping should be eliminated, pension rate of return assumptions should be changed, and workers should be required to make higher contributions. In the long term, sustainability will require governments to follow the private sectors lead and switch workers from defined-benefit pension systems to defined-contribution systems.

Matthew Glans

Senior Policy Analyst

The Heartland Institute

mglans(at)heartland(dot)org

312/377-4000

Every mayor of Detroit for the last half-century has been a Democrat. And the citys most famous industry, giving it the moniker The Motor City, has been, for the same time period utterly dominated by unions.

Democrats and unions work in concert to bleed taxpayers to create a vicious cycle of payments (and commitments for future payments) to unions part of which get donated to Democratic campaign coffers with the elected Democrats then raising taxes, sending more money to unions, etc. This is not unique to Detroit, though the utter dominance of the fiscally unholy marriage reached its pinnacle in the city which has lost a quarter of its population in the last decade the quarter which was paying taxes, apparently and nearly 60 percent since its peak nearly 60 years ago. Detroit was the only one of the nations top 25 cities to lose residents in 2013.

There is no model of government likely to more quickly reach Margaret Thatchers warning that the problem with socialism is that eventually you run out of other peoples money. While Detroits system may not have been precisely socialist, its fundamental premises, especially the idea that laborers are noble and the holders of capital are evil exploiters suitable only for financial bleeding, were the same.

So what is most surprising is not that Detroit has filed for bankruptcy but that it took so long, and that there were enough suckers available over the last few years who bought Detroit bonds despite a future that should have been absolutely obvious. Unfortunately, theres a whole other pool of suckers: American taxpayers who had billions of dollars wasted by the Obama administration bailing out uncompetitive car companies and, as always, their unions. Indeed, if the auto industry had not had an infusion of life blood stolen from the economic arteries of America, Detroit itself would have sooner reached its inevitable fate.

Ross Kaminsky

Senior Fellow, Finance

The Heartland Institute

rossputin(at)aol(dot)com

312/377-4000

Its going to get very rough because a bankruptcy judge would have the authority to abrogate government employee union pension deals. If that happens, cities and even states around the country would be smart to consider declaring bankruptcy. Could Illinois be next? Oh, wait, I said smart.

S.T. Karnick

Director of Research

The Heartland Institute

skarnick(at)heartland(dot)org

312/377-4000

Detroits bankruptcy filing is the epitaph on decades of failed city government policies that brought a great metropolis to its knees. Over the coming weeks and months much of the media attention will be on the bankruptcy proceedings, themselves, as the courts and responsible parties determine how to reorganize the citys debt liabilities among the claimants.

What will be far more important in terms of Detroits long-run future will be the public policies that become the basis for the citys revitalization and reconstruction. In a new national and global commercial environment, Detroit must make itself attractive and competitive to draw in industry and trade and the accompanying job opportunities back into what can no longer be considered the exclusively Motor city.

Dr. Richard Ebeling

Professor of Economics

Northwood University

ebelingr(at)northwood(dot)edu

914/ 564-7030

Those of us who work more closely on state and local economic and reform issues know that Detroit is the first of many. Nearly all reform controversies come down to taxpayers versus unions – especially public sector unions. In my areas of engagement, educational reform and tax reform, all of the well-funded opposition to reform comes from various public-sector employees unions.

We are relatively successful in keeping the train on the rails in Georgia and attract population and companies from states and cities who are failing in the taxpayer/unions battle. But, the ultimate question is whether states are really free to be laboratories of democracies. Will the failing cities and states be deemed too big to fail. Ill be watching in the next weeks and months for federal government backdoor-bailouts of Detroit. Will the teachers, state government employees and taxpayers of Georgia and other disciplined and frugal states, eventually pay for the less-disciplined in Detroit.and those that follow?

The White House response? Not promising. ‘While leaders

What Happens if you file Bankruptcy and you own a house?
Do I lose the house, Please let me know ASAP! Thanks everyone

Answer by Jeff
Nothing. Your house (that you reside in) is not included in a Bankruptcy.

After you have made the decision that bankruptcy is your only way out, you must be aware that filing bankruptcy is a very detailed process and one you must be right on about in order to make it to the other side of financial beginnings. There is a strict time limit that must be met in order to get your bankruptcy filed properly to the courts. The very first step you will be advised to follow is to visit a credit counselor privately or within a group to both learn about bankruptcy and learn how it could or may be avoided.

The second step is to file a petition with the bankruptcy courts within the area you live in. You will be offered to pay the legal fees in installment or in some rare, extreme cases these fees will be waived. This is the decision of the court and every bankruptcy case is different and treated this way. Many people have been under the impression that there is a standard and generic way to handle bankruptcy filings, when in fact every bankruptcy case is unique in their different circumstances.

The court will then review all your creditor documents and debts and make their decision as to how to go about paying back these debts. Often times the court will hold a meeting with the main people you owe money to and try to come to an agreement to solve the problem. This is where many people learn they have believed a myth. It is a common misconception to believe that the people you owe never get their money and therefore creating enemies. The truth is that your debts will get settled and people will understand that financial problems occur.

Lastly, your case will be determined to be an “asset” or a “non-asset”. When the court deems your case to be a non-asset your involvement in the case is over unless something unexpected occurs which is very rare.

On the other hand if your case is deemed an asset this means the court will sell your home and any other assets you have in your name in order to pay off your debts. This can be a very painful process for the person filing to see their items being sold off but in some cases this is not the only option. This is why so many professional urge people to speak with financial professionals before making rash decisions. There are many bankruptcy rules and the professionals know how to use them to your advantage.

Understanding this process is essential to your financial success. You of course do not have to learn the bankruptcy laws as well as professionals but a general understanding is quite beneficial. Bankruptcy is a serious financial step in anyone’s life and can be recovered from when you take each step properly and complete it fully. Go see a financial professional today and learn what your options are before it is too late.

Are you considering bankruptcy? Do you know what you will be getting yourself into with bankruptcy filings? If you are thinking about bankruptcy to clear your debts and get a fresh start you need to understand exactly what you are getting yourself into. Here is what no bankruptcy attorney will ever tell you about what you will be doing if you file for bankruptcy.

First, you will be telling your creditors that your word, signature, and agreement with them was never good and will never be good. This is a huge blow to your pride and to your sense of trust. When you give people a reason not to trust you, you also give yourself a reason to struggle to trust others. This is one of the major side effects of bankruptcy because it can become a way of like.

There are people that use credit cards until they cannot get anymore and have run up their limits completely, then they file bankruptcy. After their bankruptcy they do it again until they can file for bankruptcy again. This is not meant to be a way of life, but some people have made it a way of life.

Bankruptcy was meant for those that are in a pit, black hole, or just cannot make it happen on their income. They have been working very hard and have been trying to pay off their creditors, but they just cannot do it. This could be caused by being laid off, losing a job, or because of a medical emergency.

Second, bankruptcy will completely kill your credit. This will make is as hard as possible for you to get a loan for at least 2 years, except credit cards. They will try to get you to go for the highest possible interest rate and the loan or credit card will cost you more than it is worth.

Last, you have to know how to deal with your credit after a bankruptcy.

You need to get some counseling and hire a financial advisor to help. Sometimes there are volunteers at local churches that will help you set up a budget, and they will even help you take care of your debts if you choose not to file for bankruptcy.

You need to know what you are getting into with bankruptcy filings. Make sure to ask each and every question you have and get the answers you need so that you know what you are getting into and what to expect.

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