Every year, millions of people file for bankruptcy. Many find it to be a difficult process and a painful decision to make. Unfortunately, many people also have a misconception about bankruptcy and the use of a Bankruptcy Attorney in Mooresville NC. As a result, a large number of those who file claims are denied. Let’s take a closer look at bankruptcy, and whether or not it’s for you.
For starters, it’s important to note that bankruptcy should be a last resort. People typically turn to bankruptcy after they find themselves under mounds of debt that they can’t possibly pay back. In most cases the amount of debt you owe greatly surpasses the amount of income you generate.
However, any Bankruptcy Attorney in Mooresville NC can tell you that all debt doesn’t qualify for bankruptcy. You’ll either have secured or unsecured debt. Secured debt has been backed by an asset, and therefore doesn’t typically qualify for bankruptcy. Examples of secured debt would be a loan for a car or a mortgage for a home. In this case, the car and home were used to collateralize the loan. If you can’t pay your debt, this property is seized by your lender.
Since secured debt is backed by an asset it would be reasonable to assume that unsecured debt isn’t. Yes, there are no underlying assets backing unsecured debt. An example of unsecured debt would be a credit card balance from a department store or credit card company. Your credit card company can’t seize your property because you can’t pay your debt. The most they could do would be to report you to the credit bureau, or file suit against you. If you’re taken to court, you can seek consultation from the Lake Law Office PLLC.
Even if all of your debt is unsecured you will still have hurdles ahead of you. Why? For starters, courts are required to notify creditors about your attempts to escape the debt you owe. This gives your creditors the chance to ask the courts to deny your bankruptcy claims. If the courts agree, you could be stuck with the debt you owe. Speak to a Bankruptcy Attorney at Lake Law Office PLLC of Mooresville NC in the event your claim is denied.