In the UK, when a debtor owes a sum of money in excess of £750 to a creditor, he can be made bankrupt by the creditor applying to the court for a bankruptcy order to be granted against him. This sum can comprise of debts that are due to a number of creditors who may petition the court as a group for a bankruptcy order, not necessarily a single creditor.
Bankruptcy is an option that can be considered when a debtor cannot pay their debts as they become due and their financial affairs become untenable. Although bankruptcy has a bad stigma and is publicly advertised, it should always be considered, even as a last resort and a debtor can apply for a bankruptcy order on his own behalf, even if creditors are not willing to do so. Debtors who are made bankrupt will usually remain bankrupt for one year, after which any debts relating to the bankruptcy are removed.
Many debtors now enter into âIndividual Voluntary Agreementsâ (or IVAs) as an alternative to bankruptcy. If a debtorâs financial difficulties are temporary and he is likely in the future to be in receipt of funds which may pay all or most of his debts, he can talk to an insolvency practitioner with a view to obtaining such an agreement.
Through an IVA, proposals of repayment of debts are put forward to creditors, which can include banks, building societies, credit card companies and debt collection agencies, such as the CapQuest Group. Mostly these proposals involve either a lower monthly repayment or in some cases, a reduced final settlement amount. In order to succeed, however, the arrangement must be supported by at least 75% of all creditors affected by the IVA.
Despite the âsofteningâ of bankruptcy laws by the Enterprise Act 2002, the popularity of IVAs has grown in recent years. The Enterprise Act 2002 effected changes in bankruptcy law which many experts thought would see the end of IVAs, as it was generally regarded that bankruptcy would be seen as an easy way out for many debtors. However, even after a debtor is discharged from bankruptcy, many banks and other financial institutions will be aware of the debtorâs financial history and this may affect any borrowing capabilities in the future.
Personal insolvencies are at record levels across the UK, with just over 26000 bankruptcies and IVAs in the period April to June 2006. These figures represent an increase of 10% on the first quarter of 2006, and 66% over the same quarter in 2005.
However, before any decision is made as to which route to follow, it is vitally important that a debtor seeks advice from a solicitor, insolvency practitioner or local Citizens Advice Bureau. There are also many specialised companies to be found the internet that are available to the debtor who can help to arrange an IVA or provide advice on how best to proceed in dealing with their financial situation.
Martin Mcallister
http://www.articlesbase.com/finance-articles/personal-insolvencies-are-at-record-levels-across-the-uk-which-way-for-the-debtor-90263.html
With all the Health Insurance options that are available to us it can be overwhelming finding right health insurance plans for ourselves. There are literally dozens of companies with hundreds of plans to choose from. We have to agree that the main reason for having Health Insurance is to protect ourselves from large unexpected medical bills. So when comparing medical plans that is the main thing we should be looking at. Since IRS says that number one cause of Bankruptcy in the United States is medical bills, specifically medical bills that are over $17,000. We will keep that in mind as we will looks all the factors of selecting right health plan.
Before we get into comparing plans there are three main plan options to choose from: PPO (Proffered Provider Organization), HMO (Health Maintenance Organization) and HSA (Health Saving Account). The simple way to understand the differences is keep this in mind; PPO plans will give the greatest flexibility and ability to choose your own doctor usually from a extensive network of doctors. Most PPO plans have reasonable monthly premiums and usually have a hospital deductibles ranging from $500 to $5000. We will get in to deductible and how they work later on. The simplest way to explain how HMO plans work is to think of a gate keeper system. That means that you get assigned to a specific doctor or medical office (Primary Care Physician) that you have to go thorough to get authorization to get medical care. Most HMO plans comprehensive coverage, small co-pays to go see a doctor and low deductibles ranging from $0 to $1500. HMO plans tend to cost more that PPO plans. HSA plan is a relatively new concept and becoming extremely popular. HSA plans work similar to PPO plan in a context that you can choose your own doctor from extensive list of providers. HSA plan have great advantages when it comes to low monthly premiums and ability to save money tax free for the medical expenses, in similar way to 401k or IRA accounts. The reason for low monthly premiums is that HSA plans have large deductibles usually over $2400. For more information on how HSA plans work and if it is a right choice for you visit www.GuideToHealthInsurance.org
Number one thing we should be looking at is what is called âMaximum out of Pocketâ, also might be called âYearly Maximum out of Packetâ. What that means is that amount is the maximum you can be out of pocket in any given year for ALL the medical expenses combined. Most of the time that amount will exclude prescription drug coverage deductibles and co-pays. When you are comparing health insurance plans it is important to find out if everything in the plan is applied towards the âMaximum out Of Pocket. Some plans that have attractive monthly premiums might have exclusions to where âMaximum out Of Pocketâ is applied only for the hospital stays. Most of the PPO plans have âMaximum out of Pocketâ range from $3000 to $9000. For HMO plans âMaximum out of Pocketâ ranges from $1500 to $4500. Most HSA plans have where your deductible is your maximum out of pocket.
Second we should be looking for a plan from a known insurance company name. There are a lot of large well established insurance companies that you might never hear of. Reasons for staying with a large well known insurance company are that you know they will pay your bills and not going to disappear. The other reason is that chances are most doctors will accept the insurance plan that they offer. I would definitely stay away from 99.9% of Association plans and small insurance companies with less than 10 billion in Assets. You can find that our by going to Forbes.com. To date largest insurance company that provides Health Insurance is Fortis and their health insurance plans are called âAssurant Healthâ. Largest health insurance provider in the United States is Wellpoint serving approximately 34 million members nationwide. We all know them as Blue Cross and Blue Shield. Keep in mind that in some states Blue Cross and Blue Shield are owned by two completely different insurance companies.
Third we will be looking at the deductibles. There is a huge misconception with how deductibles work. The number one misconception with deductibles is that nothing is covered by the insurance company until this large deductible is met. The reality is that most plans cover most of the things before the deductible is met with small co-pay. In most cases deductible applies only for inpatient and out-patient hospital (surgeries, emergency room). Second misconception is that once deductible is met everything is covered 100% or in case of hospital stay all we will be responsible is the deductible. Although some plans do work that way, most health plans do not. Majority of health plans you are still responsible for, whatâs called co-insurance. That meant that you are still paying percentage of the bill usually 30% up to you âMaximum out of Pocketâ as me mentioned earlier. That is why âMaximum out of Pocketâ is more important that the deductible. For example if you have a plan with a 2500 deductible and 30% hospital co-insurance, then you are responsible for 2500 plus 30% up to âMaximum out of Pocketâ. There are some plan today available that have no deductible and they are relatively inexpensive. Chances are those are the plans that have high âMaximum out of Pocketâ in most cases over 7500 per person. In case of a family of four in worst case scenario you could be responsible for $30,000. If there is no deductible it does not meat that everything is covered at 100%. The way plans with no deductible work is by having you pay a percentage of the bill starting with the first dollar. Percentage could range anywhere from 30% to 50%, again up to your âMaximum out of Pocketâ amount. The larger deductible you choose the lower monthly premium you will pay. My recommendation will be that you choose deductibles over 2500 unless you are planning on being admitted to the hospital often.
Fourth we will be looking at the prescription drug coverage. The reason prescription drug coverage is very important, because drugs can be very expensive. In the event of major illness or accident drug cost could be in the hundreds even thousands of dollars every month. Most plans do cover prescription drugs. There are few things to consider. First check if the plan has limits on how much the insurance company willing to pay for your prescription drugs per year. Most plans cover prescription drugs up to your life time maximum which should range anywhere from 2 million to 8 million. Some plans offer option where they will cover only generic drugs. This in most cases is sufficient. About 90% off all the brand name drugs have equivalent generic drug available. By choosing a plan that covers generic drugs only you can be saving a lot of money every month on you health insurance premium. Next you should be looking at the deductibles for the prescription drugs. In most cases if plans covers generic and brand name drugs you will have a deductible for brand name drug before your co-pay begins. Most brand name drug deductibles range anywhere from $250 to $1000. Majority of the health plans cover generic prescription drugs right away.
Fifth we will look at annual physical exam coverage. Most plans cover physical exams once a year. There are few things to consider. First if there a waiting period before you can get insurance company pay for your physical exam. Second what is the maximum that insurance company is willing to pay for your physical exam? Last is what your co-pay to get a physical exam is.
Sixth we will look at the doctor visit co-pays. That means what is the amount that you are responsible for after witch insurance company pays for everything at 100%. There are some options to consider. Doctor office visit co-pay could range anywhere from $10 to $50. Some plan might have you pay a percentage of the doctorâs office visit. After witch insurance company is willing to pay at 100%. Second thing to consider is if the co-pay included lab work and x-ray. Most of the time Lab work and x-rays is billed separately. Company like Assurant Health is willing to pay up to $100 for your lab work and x-rays as part of your co-pay. One of the main things that most people look for in a plan is, how much is their co-pay to go to a doctor? Even though no one in history ever went bankrupt because they could not pay for their doctor visit. If you were to going to pay out of pocket for your doctors visit it will probably cost you anywhere from $45 to $100. The only way it is going to be more than that is of you had sad lab work or minor out patient surgery done.
After reading this article you should have idea of what kind of plan you might want for your self and your family. The one additional thing that I would consider is how well your plan travels with you. For example if you decide to move to a different state or if you travel outside of the country. Most plans do not travel well and most donât cover you if you are outside the country. I most cases if you can a plan in one state and you decide to move to a different state you have to cancel the plans in the state you are moving from and re-apply in the new state. Even if you had same insurance company in the state that you are moving from.
Dennis Alexander
http://www.articlesbase.com/finance-articles/what-to-look-for-when-shopping-for-a-health-insurance-plan-109348.html
Bankruptcy is a contentious word for a whole number of reasons. Firstly it relates to a situation whereby a Debtor not being able to satisfy or compound to his Creditors a suitable amount has to turn to the Courts for protection and at the end of the day everyone loses out.
Let me repeat this last fact lest it passes some by. In a Bankruptcy situation no one wins. It is a âlose-loseâ scenario. The Debtors by and large lose almost everything he or she owns (unless they are very carefully advised) and the Creditors by and large lose their money because when the Courts, Bankruptcy Trustees etc take their cut there is usually only a dividend of mere pence in the pound at the end of the day.
I hope all petitioning solicitors and lawyers read this with care as they are the ones who are advising all of their clients to sue people for bankruptcy. It is a bit like loading up pistols left right and centre for a âRussian Roulette Festâ it gets nobody anywhere.
In fact having read the last paragraph in more detail I take back my comment about Bankruptcy being a lose-lose situation itâs not, the Lawyers and Accountants make a fortune out of their fees, no one else does.
But there is a hidden cost to all of this that no one is prepared to acknowledge and this includes the knock on cost of ill health brought about by the stress of Bankruptcy. It is the âsleeping elephantâ (for want of a more suitable metaphor) in the corner of the room that no one wants to acknowledge but it is certainly there all the same.
Let us analyse part of that âill healthâ that we referred to above and that is the area of High Blood Pressure. It is one of the few natural growth phenomena of the late 20th and 21st Centuries and now is assuming almost epidemic proportions. The stress and elevated blood pressure brought about by the comings and goings of bankruptcy and all of the shenanigans that ensue can be lethal and in some cases lead to fatal consequences.
Our Society is so powered by the worship of all things financial that in the âheated blood lust of debt recoveryâ we seldom stop to consider the hidden human cost to all of this. I have client who as well as his business career being well and truly finished (boy was he badly advised earlier on but that is another issue) but his health, or should I say ill-health, is such now that any job prospects he might have had are now well and truly finished.
Now let us consider who well and truly gains by any of this? The answer? No one and if I can make just one final point it is a plea to any Solicitors and Lawyers who may, just may be reading this article. When you advise clients to pursue matters to Bankruptcy, get your background research carried out properly, do your due diligence well and get it right because at the end of the day as well as well and truly losing the majority of your clients money (which statistics point out is most certainly the case) you also damage the health of the person at the end of the writ.
Do you know the sad thing abut the whole side of this? I bet there is not a Solicitor or Layer who really cares, as long as they get their bonus and their fees, who gives a damn about anybody else?
Stephen Morgan
http://www.articlesbase.com/finance-articles/the-hidden-cost-of-bankruptcy-110647.html
Most consumers who are looking at a mountain of overwhelming debt as well as students who have graduated from college and needing to start paying back that huge amount of student loan debt may be considering bankruptcy to wipe the slate clean and start over again. But bankruptcy may not be the right option for you, and you may not even be eligible to file bankruptcy.
The vast majority of consumer bankruptcy filings are done using Chapter 7 bankruptcy law which will wipe out most unsecured financial obligations, which typically includes most credit cards, signature loans and similar lines of credit. One of the most important aspects of chapter 7 bankruptcy is that it also stops creditors cold in their tracks from calling you, harassing you at all hours of the day and weekends, and also stops any wage garnishment proceedings which may be in progress.
But you need to take a long hard look at the source of your debts since there are multiple types of debts that bankruptcy will not absolve you of. Bankruptcy will not get rid of secured debts where you have put up collateral to get that loan originally. If you have student debt that was federally funded, bankruptcy does not eliminate this type of student loan.
For the consumer, one of the requirements of the recently changed bankruptcy laws is that they attend mandatory credit counseling. To a certain extent, this is foolish, since many bankruptcy filings are not due to financial mismanagement on the part of the consumer but are due to circumstances beyond the control of the consumer, such as huge medical bills, a job layoff, a messy divorce, etc. In this case, credit counseling may be helpful to an extent, but that was not the reason that bankruptcy is being considered. Nonetheless, credit counseling is a requirement and there is no way around that.
Contrary to popular belief, bankruptcy does not mean you will lose everything. The federal bankruptcy courts will make an exemption or allowance for you to keep things that are necessary for basic living, such as your house, your car, etc. But each case is evaluated individually, so if your current house is a beachfront condo in Miami and your current car is a late model Porsche, that may be replaced by order of the court for something a bit more economical.
You need to be aware of the ramifications of filing bankruptcy. It will stay on your credit reports for the next 7 to 10 years, and will be a huge red flag to lenders where you are requesting a new line of credit. With a bit of digging, you can get approved for new credit, but you will almost certainly be paying a higher rate of interest until you can get yourself back on track.
You should thoroughly investigate all your bankruptcy alternatives and options before filing. Make sure you know the law, since with the recently changes, this is no longer something you would want to attempt yourself. A good bankruptcy lawyer can save you more than you would lose and would be worth the investment many times over.
Jon Arnold
http://www.articlesbase.com/finance-articles/bankruptcy-may-not-be-the-right-answer-for-you-261662.html
My chapter 7 bankruptcy was recently discharged and I don’t know what exactly was discharged. I live in Georgia and need to know where I can find this information. On my credit report, it only shows that it has been discharged. Do I need to go to the US Bankruptcy Court in Georgia to get this information. I tried calling my trustee and they could not tell me.
The attorney that handled your case should be able to provide you with this information, seeing you gave them a list of debts to include in your filing. The paper you are looking for is called a Creditors Matrix. The US Bankruptcy Court in GA can tell you, they need your case # and tell them you were recently discharged and you’d like to obtain the Creditors Matrix of your filing, start with your attorney first, they should have all of this in your files. Good Luck!
Has anyone found a lender who will give them a mortgage while still in chapter 13 banruptcy?
Before discharge of Chapter 13.
And if so please give the lenders name.
Great so it’s been done all the time. By whom?
Yep, if you have 12 months good payments in 13, did it all the time.
My business closed and I am basically forced into filing personal bankruptcy. If I die before I get the final discharge from the court can the bank claim part of the life insurance instead of my wife getting it all? My questions boils down to, do I need some extra insurance until the bankruptcy is final later this year?
It depends on whether you file a joint bankruptcy with your wife, or an individual bankruptcy without your wife.
If you file jointly, then the bankruptcy estate still exists even after the death of one spouse, so in that case it is possible that some life insurance proceeds paid to your wife might (in some circumstances go to pay creditors.
If you file separately, then no, the debts die with the debtor.
My husband works freelance for a company that is having financial problems, he hasn’t been paid since October. Now they are shuting the doors and we don’t know if they are filing for bankruptcy (or protection). But where does an employee come in on the food chain? Will a company that has leased equiptment to this business be paid before my husband? Please any answers will be very much appreciated. Thank you.
Your letter claims he was a "freelance" worker. That implies he was working as a contractor, not an employee in legal terms.
Therefore, he falls in with the other creditors.
Depending on the type of bankruptcy, he may get some money. First in line are "priority" debts like taxes and government loans. "Secured" loans are next, for mortgages or any loan that has a property lien attached.
Whatever is left over gets divided between all of the other creditors.
Remember this is a vague answer because all of the states have differant rules. Businesses will fall under differant rules. And the new bankruptcy law that took effect last year makes it worse to predict what will happen to your husband’s money.
Good luck.
My business is failing. I am getting sued for 200k and my bank forclosed on my loans. My building and my home is going into forclosure. Can I fill bankrupacy persoanly and for my business and try to save my home.
Of course you can. Both are seperate legal entities.
I have 60 grand in medical bills and was going to file for bankruptcy but heard that that doesn’t cover medical bills anymore. I want to get married but with tha much money owed I think they would go after my honey for the money. Would they? These are the questions, are bankruptcy laws state or federal? does bankruptcy cover medical bills? would they go after my honey if I married him for the money I owe
K they r federal but do they cover medical bills????
First advice - see a bankruptcy lawyer in your community.
Look on the web for NACBA - National Association of
Consumer Bankruptcy Attorneys. On the website, you will be able to find a bankruptcy attorney in your geographic area.
bankruptcy laws are federal. However, in certain situations, the federal bankruptcy laws refer to applicable state laws. For example, your state may have "elected" - to have its own exemption laws apply - rather than the federal exemptions. An exemption is property (personal property and real property) that is excluded from the bankruptcy - and the debtor (the one who files for bankruptcy) gets to keep it.
Since you are planning to get married, I especially urge you to see an attorney immediately regarding your situation.