While Chapter 7 bankruptcy is often harder to obtain than a Chapter 13 bankruptcy, it is a powerful tool that can be used to wipe out most types of unsecured debt such as credit card debt, personal and business loans, medical debt, apartment leases, cellphone and utility bills, and auto repossession overage balances. Essentially, any type of debt that is not specially tied to property can be eliminated in Chapter 7 bankruptcy.
It’s important to note that some types of unsecured debt are afforded a special classification under California bankruptcy laws. These unsecured debts are referred to as non-dischargeable debts and include debts such as child support, alimony, student loans, recent purchases of luxury items, tax debts incurred within
The legislation is a complex in part because those creditors fall into so many categories-secured creditors, unsecured creditors, government creditors, and so on-each with its own special rights and interests in the bankruptcy process.
When the majority of people see a pitcher on the mound, they think the pitcher is no different than any other pitcher. People are often shocked to find out that there are many ways to distinguish one pitcher from another. Although there are many similarities in every pitcher, there are also many differences when distinguishing between starting, relieving, and closing pitchers.
Timeline of this case should be clearly organized in order to better understanding this case. In 2009, Poor Son transferred Rich Grandson to Parent. In 2010, Poor Son filed a voluntary petition for reorganization under Chapter 11 of the US bankruptcy code, and Parent deconsolidated Poor Son from statements. In 2011, Poor Son filed an action against Parent seeking to void the transfer of Rich Grandson. In May 2012, the bankruptcy court held a selection meeting in which it considered competing plans of reorganization submitted by four bidders. In June 2012, OtherCo, an unrelated party, became the wining plan sponsor. In July 2012, OtherCo rescind its offer because the bad evonomic condition. In December 2014, the bankruptcy court recommended
Himmelstein, D., Thorne, D., Warren, E., & Woolhandler, S. (2009). Medical bankruptcy in the United States, 2007: results of a national study (clinical research study). Retrieved from ProCon: http://healthcare.procon.org/
Before a debtor or organization can seek protection of the CCAA, such company must be insolvent either via liquidity or balance sheet and must have incurred debt worth of five million dollars. The emphasis of this article will be on Bankruptcy and Insolvency Acts (BIA) and how it helps financially troubled and honest citizen with their financial trouble. The BIA was established to protect the rights of debtors and creditors as well as informing trustees, courts and other stakeholders of their responsibilities, powers and duties. In order to properly protect the rights of debtors, creditors and other stakeholders, the BIA is organized into 14 different parts; these parts are discussed
Chapter 13 Bankruptcy vs. Chapter 7 Bankruptcy A chapter 13 is the best choice between the two bankruptcy options. The most appealing part of a chapter 13 bankruptcy ruling will be that you will have a period of time to repay your outstanding debts, all of them including your mortgage. With a chapter 13 bankruptcy plan you can avoid foreclosure, stay in your home, while you begin to repay the delinquent money on your mortgage.
Credit card debt is what’s known as unsecured consumer debt. Card debt is not necessarily collected through the use of a credit card. Debt can be accumulated from transfers, such as transferring money to make a payment or to another account. This can get you in a cycle of revolving debt meaning, what you owe can spiral out of control. Many people owe money because of the current financial situation of the U.S Economy. Credit card has a major impact on one’s personal wealth. People who have an asset have personal wealth; some examples of an asset are your house as well as your land. Many people may feel if the house burns down or gets destroy in a tragedy, then they have nothing left but that not the case. You still have your land, but asset also come in form of items that may be more personal such as a car, bank account, stocks and bonds or an item of value that has been passed down for generation.
Private and public accounting has long been discussed and disputed in regards to financial reporting. Since the Financial Accounting Standards Board (FASB) was created in 1973, accountants have called for different accounting regulations for private and public accounting sectors, as private companies do not have the resources to meet the complex requirements of public companies. Private companies currently are not required by law to issue annual or quarterly financial statements (James, 2012). Private companies do, however, have the option to apply the U.S. Generally Accepted Accounting Principles (GAAP), cash basis, or accrual accounting to their financial statements (James, 2012).
Among the study’s findings were that the deciding factor of the predictor of bankruptcy should not be only a few ratios, as the measure of a company’s financial solvency may differ as the firm’s situations differ. The important question is to which ratios are to be used and of those ratios chosen, which ratios are given priority weight.
This is supported by the study of Hakim and Haddad (1999) which found that the loan repayment obligations related to income and are an important factor in the possibility of default.... ... middle of paper ... ... According to the Credit Counselling and Management Agency (CCMA) (2012), the main reasons people fail to pay a debt were poor financial planning (25%), high medical expenses (22%), business failures or slowdowns (15%), loss of control over the usage of credit cards (13%), and loss of jobs or retrenchments (10%). Therefore, Lea, Webley and Walker (1995) found that debt with economic, social and psychological factors are closely related.
Chapter 7 and Chapter 13 bankruptcies are full of advantages and disadvantages. But at the same time they are very different. Without knowing these differences a person could lose many things from money to possessions.
The capital structure of a firm is the way in which it decides to finance its operations from various funds, comprising debt, such as bonds and outstanding loans, and equity, including stock and retained earnings. In the long term, firms seek to find the optimal debt-equity ratio. This essay will explore the advantages and disadvantages of different capital structure mixes, and consider whether this has any relevance to firm value in theory and in reality.
Mortgages, car loans, student loans, and having children, are all situations that can drive families to the overwhelming doom of debt. Debt is mostly overlooked for the simple reason that it may be considered normal. Certain types of debt, like car and mortgage payments, are almost always expected. Debt is sometimes very difficult to evade, especially if money is not managed sensibly. Many families accumulate debt due to overspending, medical bills, and unemployment.
A person who is unable or unwilling to pay his or her debts may declare bankruptcy. The state of being solvent means that one has the ability to pay his or her debts. However, insolvency means that a person cannot pay his or her debts. In order to declare bankruptcy, a person must file a petition for bankruptcy in a bankruptcy court. A voluntary bankruptcy proceeding is started by the person who is declaring bankruptcy, whereas an involuntary bankruptcy proceeding is started by the creditors of the bankrupt person.
There are two basic ways of financing for a business: Debt financing and equity financing. Debt financing is defined as 'borrowing money that is to be repaid over a period of time, usually with interest" (Financing Basics, 1). The lender does not gain any ownership in the business that is borrowing. Equity financing is described as "an exchange of money for a share of business ownership" (Financing Basics, 1). This form of financing allows the business to obtain funds without having to repay a specific amount of money at any particular time. There are also a few different instruments that could be defined as either debt or equity. One such instrument is stock options that an employee can exercise after so many years with the company. Either using the debt or equity method, or a combination of the two methods can be used to account for stock options or other instruments with the similar characteristics.