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Bankruptcy May Not be a Bad Idea

In today’s economy, bankruptcy is no longer the shameful act that it once was. Filing bankruptcy is now used by one percenters and failed businessmen alike, and if used correctly filing for bankruptcy is a strong strategic financial move. Even the unimaginably rich presumptive republican candidate Donald Trump has declared bankruptcy multiple times and has helped him save several failed companies. However, for someone that does not possess an inordinate amount of money bankruptcy can still be a great idea albeit it is a much different form of bankruptcy than that of Mr. Trump. For these individuals, chapter 7 bankruptcy may be the tactic that can provide financial relief they need. Chapter 7 bankruptcy is applicable for the individual, a partnership, or a corporation and works much like the conventional theory of bankruptcy where a debtors assets are liquidated to service debts. In order to qualify for chapter 7, an applicant must fulfill the means test. According to Bradford Law firm LLC, to pass the means test, the debtors wage, disposable income, and monthly expenses are compared to the median income of the state and then evaluated. Chapter 7 bankruptcy begins by filing a official petition to a bankruptcy court, and then completing the Official Bankruptcy Forms which include a list of all creditors and amounts of their claim, source and amount of debtor’s income, list of all debtors property, as well as all relevant financial information. The debtor’s financial standing are then assessed and the court will appoint an impartial case trustee that will oversee the liquidation of the debtors assets. Assets are then divided into exempt and non-exempt property, with the latter being the only assets that can be liquidated to fulfill debts. Exempt property can include clothing, household goods, pensions, and tools of trade, these properties will not see liquidation and are only protected up to...
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