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

Chapter 7 bankruptcy involves liquidating assets to pay creditors. The good thing is that a majority of people are able to keep essential possessions such as their home and vehicles of high value. Also, there’s a high chance that any court proceeding that’s been commenced in relation to debts that are not paid will be stopped when an individual is declared bankrupt.

Generally speaking, those with a regular income can file for Chapter 13 which allows them to come up with an arrangement that why not try these out will pay off their debts over the course of three to five years. The good thing is that it blocks creditors from trying to foreclose, take possession of or the wages of employees during this period.

Loan servicers that use a customizable and complete bankruptcy processing system such as Best Case by Stretto can automate bankruptcy notifications, track changes in account data and improve communication with attorneys. This powerful tool searches vast nationwide bankruptcy databases to automatically discover and notify clients of any changes, allowing them to minimize risk and avoid unnecessary operational costs.