Profit and loss are part of every business. But where there is loss and appropriate corrective steps are not taken, then the losses may accumulate and the businessman may reach a stage where he may become insolvent or bankrupt. Even those who are in employment may reach a stage of bankruptcy if they do not properly manage their budget and if they get themselves trapped in debt. In such a case they have no other option but to file an application for bankruptcy.

Many people hesitate to file application for bankruptcy because they fear the social stigma they would carry amongst their relatives and friends. They are afraid because people would ridicule them and that may even affect the careers of their family members. But they would have reached a stage where they are driven to the wall and there is no other option but to file a bankruptcy application.

Application for bankruptcy:

Normally it takes some weeks and months to get the final orders from the appropriate authorities on the bankruptcy application. During this period, the applicant has to remain composed and calm. In fact patience is the need of the hour for such applicants. Some financial analysts say that the bankruptcy application actually helps the applicant improve his credit scoring. Instead of delaying payments and getting rebuke from the banker, the bankruptcy application will help him to rebuild his business afresh. There are many instances where people declared bankrupt have come back with a thumb up and they have astonishingly improved their credit ratings.

How to file an application for bankruptcy?

To file an application for bankruptcy, the applicant has to take the help of an attorney who would file the application in person. This is because the attorney is aware of the papers which will have to be filed along with the application and the procedures to be followed thereafter. Now provision has been made to file the application online through a process called the PACER (Public Access Court Electronic Records). Even here the application has to be filed through an attorney only. In other words the application cannot be filed directly by the applicant. This is to ensure that all the formalities have been complied with. Of course even here, the applicant has to be present himself before the appropriate authorities to sign the documents in their presence. But filing the application online is preferred because it ensures some sort of confidentiality about the applicant.




Debbie Joneta also writes about Bankruptcy and Credit issues including File Personal Bankruptcy and How to Declare Bankruptcy

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