Are Bankruptcy Laws The Same In All States ?
Most of us are aware of various laws concerning bankruptcy, either of an individual or of a company. There are several clauses and norms, fulfilling which one gets to file for bankruptcy. However, these laws and norms are not the same everywhere. They vary from state to state and country to country, depending on the population, economy and other factors. |
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For example, if you are a resident of the state of Illinois and are filing for personal bankruptcy, yet you want to retain your house or car, there are some provisions for it. If your home’s equity is less than $7500 and the worth of your automobile is less than or equal to $1200, they can be protected. For California state residents, bankrupt applicants can keep aside some of their retirement accounts from the process, provided they are qualified accounts and have allowable contributions under them.
Debtors of New York State need to sign up for money management classes from a verified credit counselor at his own expense, six months prior to applying for bankruptcy, to ensure that he becomes a better money handler in the post bankruptcy period. Alabama residents need to go through a selection procedure from a lot of form types before filing for bankruptcy. He first needs to ensure which chapter of bankruptcy he wants to opt for from 7 and 13. Then he needs to fill up the right form accordingly.
The laws though different in all the states, yet they all are designed in a way to ensure that the people filing for bankruptcy have the right eligibility and that they would not have to face the same situation again anytime in the future.
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A major deterrent the credit report of a person can have is bankruptcy. Even though some of the laws regarding bankruptcy can ensure the debtor to get rid of many dues and payments upon filing for it, yet it leaves a bad impression in his credit history for maximum ten years. Thus people filing for bankruptcy should search for any other viable option before giving in to it.