Why is the threat of bankruptcy so important? You must understand the impact of bankruptcy on the finances of credit card companies and other unsecured lenders.
When you file for bankruptcy, all your assets shall be sold off and shall be used to repay all your liabilities.
The law states that all those assets which have a loan attached to it shall be utilized for repayment of that loan only.
If there is any value left after the repayment of the loan, only that amount will be considered as free amount available for repayment of other debts.
That is to say, if you have taken a hundred thousand dollar mortgage loan and if the value of your house is seventy five thousand dollars, this money shall be used to repay the mortgage debt.
If the debt exceeds seventy five thousand dollars, you will have to pay extra.
If it is less than the amount, only then can unsecured lenders and other lenders enjoy any payment out of the sale of the house.
Since unsecured lenders do not have any security or collateral assets, they stand at the highest risk as far as collection of debt is concerned.
That is the reason why they charge a very high interest rate.
Yet, there is no denying that the loss that they suffer due to non repayment is very high.
Why does an individual file for bankruptcy? When there is absolutely no scope of repayment of debt, the individual proceeds to go ahead and file for bankruptcy.
Unsecured debt is the primary motivating factor.
Nobody files for bankruptcy because he or she is not in a position to repay the home loan.
At worst, the individual try to sell the house to repay the loan.
Unsecured lenders are prepared to offer generous discounts up to fifty percent of the total amount owed if it helps the individual avoid bankruptcy.
How can you take advantage of this approach? You just have to get in touch with the lenders and convince them to give you a discount.
You will have to explain that you are facing financial problems and they are so grave that you might end up in bankruptcy.
In such a scenario, if you make use of professional service providers, you will find it very easy to overcome the problem.
You just have to stick to the plan and let the professional do all the negotiating.
Once this is done, you will automatically end up with reduced debt.
When you file for bankruptcy, all your assets shall be sold off and shall be used to repay all your liabilities.
The law states that all those assets which have a loan attached to it shall be utilized for repayment of that loan only.
If there is any value left after the repayment of the loan, only that amount will be considered as free amount available for repayment of other debts.
That is to say, if you have taken a hundred thousand dollar mortgage loan and if the value of your house is seventy five thousand dollars, this money shall be used to repay the mortgage debt.
If the debt exceeds seventy five thousand dollars, you will have to pay extra.
If it is less than the amount, only then can unsecured lenders and other lenders enjoy any payment out of the sale of the house.
Since unsecured lenders do not have any security or collateral assets, they stand at the highest risk as far as collection of debt is concerned.
That is the reason why they charge a very high interest rate.
Yet, there is no denying that the loss that they suffer due to non repayment is very high.
Why does an individual file for bankruptcy? When there is absolutely no scope of repayment of debt, the individual proceeds to go ahead and file for bankruptcy.
Unsecured debt is the primary motivating factor.
Nobody files for bankruptcy because he or she is not in a position to repay the home loan.
At worst, the individual try to sell the house to repay the loan.
Unsecured lenders are prepared to offer generous discounts up to fifty percent of the total amount owed if it helps the individual avoid bankruptcy.
How can you take advantage of this approach? You just have to get in touch with the lenders and convince them to give you a discount.
You will have to explain that you are facing financial problems and they are so grave that you might end up in bankruptcy.
In such a scenario, if you make use of professional service providers, you will find it very easy to overcome the problem.
You just have to stick to the plan and let the professional do all the negotiating.
Once this is done, you will automatically end up with reduced debt.
SHARE
