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In the majority of cases, merely thinking about personal bankruptcy is sufficient to scare someone so much that they might panic and be afraid to realistically look at their financial problems. Unfortunately, statistics show that around five people out of every thousand have found themselves declaring personal bankruptcy and even more disturbing, this figure is on the rise. Additionally, studies from research agencies show that the primary reason that people are filing for personal bankruptcy is due to excessive spending which accounts for extreme debt. If these same consumers then get the financial weight of unplanned and unanticipated circumstances this can throw their budgets into complete disarray. There are numerous grounds why an individual might file for bankruptcy. Losing a job or paying for divorce proceedings are common as is the death of a spouse. Any of these have the possibility to indicate calamity for your finances. The typical individual that chooses to file for bankruptcy is usually someone who successfully graduated from high school, is a blue collar employee, and is also the head of the household, although they are in all probability in the category of lower middle income. Simultaneously this individual is also going to have stretched their finances too far and probably depended heavily on credit in the past. Laws presently are in place that work to protect both the creditor and debtor and such laws exist to ensure that those debtors who are honest suffer as little as possible due to their financial mismanagement. The same laws likewise offer protection to the creditor and helps them to recover any monies they are owed. If you are looking at filing for personal bankruptcy there are two options available to you. The first is that you can choose to file for Chapter 7 bankruptcy. The second option is Chapter 13 bankruptcy and both are substantially different. Chapter 7 bankruptcy requires all of your assets (that are not exempt) to be sold off and the revenues of these assets will be spread amongst your creditors to satisfy the debt they are owed. Chapter 13 bankruptcy is a more or less softer choice in that it does not expect any liquidation of your assets. It does nevertheless require you to reorganize your financial obligations in such a way that you are able to make debt payments over a timescale of between three and five years. One of the things that many people do not think of, however, is that the choice of which chapter to file is not their choice. Rather, this is a decision of the courts, who will make that decision after a close inspection of your particular financial data. It is because of this that a bankruptcy lawyer is strongly recommended so your data can be exhibited in the right format. However, concern is present amongst numerous financial analysts who view personal bankruptcy as a real menace to the wellness of the economy and there is just grounds for this. The number of people who file for personal bankruptcy is rising causing a distressing trend. In turn this has prompted some dramatic measures being taken. Only recently, in March 2005, the Bankruptcy Abuse Prevention and Consumer Protection Act of 2005 was presented and this requires people who file for personal bankruptcy to accomplish a number of tests on the state of their income and to adhere to stricter regulations before they are permitted to declare this type of bankruptcy. For more insights and additional information about a Personal Bankruptcy as well as getting a free bankruptcy evaluation from a qualified and experienced bankruptcy lawyer in your area, please visit our web site at http://www.bankruptcy-data.com
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