Stuck with financial problems? Thank the new concept of bankruptcy.
Bankruptcy is an alternate of all financial problems. In simple words, bankruptcy is a legal procedure using, which anyone who cannot repay debts may look for relief. Relief in form of exemption from paying back some or all debts. Here is a description of bankruptcy exemptions in Oklahoma.
· The main purposes of bankruptcy are:-
a) A new start for a sincere and truthful but helpless Debtor.
b) And equivalent conduct towards Creditor.
If someone registers for bankruptcy acts act according to its code rules, the law gives:
- Discharge i.e. canceling many of the debts by court orders.
- And allow the debtor to pay a portion of what they owed depending on their ability.
Discharge helps the debtor as it prevents a creditor from seeking the collection of the remaining amount owed.
· Kinds of bankruptcy:-
a) 2-3 MONTH procedure- The real property is sold to repay for the discharge of the debts.
b) 3-5 YEAR procedure- Under the supervision of the court’s repayment plan, some portion of the debt is paid.
c) 3-5 YEAR procedure- similar to above but only for fishermen, farmers, and family.
d) Complex procedure- Mainly business debtors use this. Sometimes individuals with considerable debt and property also use it.
· 2-3 Month vs. 3-5 Year process:-
a) Bankruptcy exemptions in Oklahoma (Property that can be kept)-
2-3 Months: The necessary portion is exempted. And the trustee that has been appointed by the court sells the remaining property to pay back the creditors.
3-5 Years: All property is exempted. Debts are paid back by income from the future.
b) TIME TAKEN-
2-3 Months.
3-5 Years. A portion of what was owed needs to be paid back in this duration to the creditors.
c) COST-
2-3 Months: $299 to file a petition in the court. And additional charges of the lawyer depending on the lawyer’s fee.
3-4 Years: $274 to file a petition in the court. And additional charges of a lawyer.
d) CREDIT REPORT-
2-3 Months: remains in the credit report for 10 years.
3-5 Years: allowed to be kept.
· Eligibility for Bankruptcy exemptions in Oklahoma:-
a) If someone with mainly consumer debts wants to file a case, the lawyer will first examinee their finances. If the debtor can pay based on a formula called “mean test”; the debtor is not allowed to file the case.
b) If the income of the debtor is at or less than the median earnings; the man test is not applied.
c) If income higher than the median earnings. The mean test makes a comparison of monthly earnings minus allowed living expenses, to a portion of unsecured debt. This determines how much is needed to be paid to the creditor if under 3-5 years process. However, if uncertain of the value court may allow staying under 2-3 months procedure.
d) For filing a case under a 3-5 years procedure, the debtor should have a regular income. And debts should be over a fixed amount. However, this amount goes up every 3 years.
Creditors must stop an attempt to call for debts after a BANKRUPTCY case has been filed.
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