The advantages of filing for Bankruptcy
By DCA Business Recovery LLP
Bankruptcy is a cost-effective debt solution that helps individuals become free of their debts.
Despite it’s disadvantages, filing for a bankruptcy can be the best course of action, depending on the circumstances. Bankruptcy has various financial and emotional benefits, which include the following:
Filing for a bankruptcy gives people the chance to help regain control of their personal finances. During the bankruptcy process, you will not have to deal with your creditors yourself as the official receiver will take control of your assets and deal with your creditors for you. This will therefore make your situation less tense and stressful because you are no longer required to deal with creditors personally. Also, when the bankruptcy order is made, all actions and claims are frozen and halted and legal action from creditors is stopped immediately.
You should also stop receiving harassing, stressful phone calls and letters from creditors such as collection agencies. If you receive any type of contact from creditors once you have filed for your bankruptcy you are in a position to forward this on to the official receiver for them to deal with this. At the time of filing for a bankruptcy, you will automatically be free from your debt, all loans will halt and other debts will stop accumulating. You are officially discharged from your debt once you are discharged from your bankruptcy, which is automatic after 12 months, unless the Trustee decides to suspend your bankruptcy.
In order to go bankrupt, you must apply to the County Court in your area of residence.
Bankruptcy offers a way to eliminate the debt that is owed by debtors. In some cases, a payment plan can be set up in order for some or all of the debt to be paid, if you have disposable income. Throughout the bankruptcy process, debtors are fully protected by the courts from any legal action that creditors may try to enforce on them.
It is important that you carefully consider the option of bankruptcy and think about the course of action that is right for you, depending on your financial situation.
After filing for bankruptcy and being discharged, most types of debt will be written off, usually after one year. You will now have the opportunity to regain control of your finances and begin to improve and build on your own personal credit rating.