Bankruptcy Solutions – Why Bankruptcy Is The Last Resort

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The decision to file for bankruptcy is not one that should be taken lightly. It’s usually a last-resort option that is used after trying other debt relief solutions. The bankruptcy process damages credit, limits access to loans and can cause the loss of valuable items. It can also hinder future financial goals, such as buying a car or home, obtaining a job and getting insurance. Financial advisors advise exploring other debt relief options before bankruptcy.

Chapter 7 bankruptcy involves liquidating assets in order to pay creditors. The good thing is that most people can keep essential possessions such as their home and valuable vehicles. In addition, any court action taken in relation to unpaid bills could be halted if a person becomes bankrupt.

In general, people with regular incomes can choose to file Chapter 13 to create a plan to pay off their debts within three to five years. The good news is that it stops creditors from attempting to foreclose, seize or the wages of employees during this period.

With a complete and flexible bankruptcy processing software such as Best Case by Stretto, loan servicers can automate bankruptcy notification and monitor changes to account information and enhance communication with attorneys. This powerful tool searches vast bankruptcy databases across the country to automatically detect and inform clients of any changes, allowing them to reduce risk and avoid unnecessary operational costs.