The number of people that approach the courts for liquidation orders rise every year. More and more people find themselves in financial difficulties so severe that they cannot pay their debts any longer. There are many factors that contribute to this problem. Companies are retrenching workers, the economy is sluggish and the currency is unstable. When obtaining the services of a bankruptcy attorney Washington DC clients can rest assured that some solution to their woes will be found.
When either a business or an individual make an application in terms of chapters 7 or 13 they should never be under the impression that the application will be granted quickly and automatically. It is a long process and applicants are well advised to get a lawyer to deal with their applications. Lawyers specializing in this field can shield their clients from the worst stress.
Asking for a liquidation order is not a convenient way to get rid of financial obligations. The court will scrutinize the affairs of the applicant and will need to be absolutely certain that he cannot honour his financial obligations. A means test will be applied and the first priority of the court will be to make sure that the debtors do not suffer unnecessary losses.
As soon as a court receives an application a trustee is appointed to manage the entire process. The trustee is given wide powers. If the applicant is a business, the trustee may close the business and sell all the assets or he may sell the business as a going concern. In the case of individuals all their assets are sold on open auction and the proceeds will be distributed between the debtors.
Many applicants are shocked when they realize that a liquidation order does not cancel all their financial obligations. If they have secured loans, it remains their responsibility to pay it back. They will also have to honour their tax obligations and pay child support. It is customary to let the applicant keep crucial assets such as his car and some of his furniture.
The lawyer will make very sure that his client understands and accepts the serious consequences of liquidation before he will file the application. His credit record will be poor and he will not be able to apply for a loan for at least ten years. During the rehabilitation period his financial circumstances may be reviewed at any time. He will have to downgrade his lifestyle too.
Because a liquidation order can have such serious implications the lawyer will try to find alternative solutions. In many cases he will be able to negotiate with debtors and agree to new payment plans whereby the client will by smaller amounts over a longer period. In most cases such a solution is far better than a liquidation order.
Far too many people land up in the bankruptcy court because they fail to manage their personal finances and they incur debt by buying unnecessary luxuries. It is vital to have a sensible budget and to live according to that budget. When trouble does occur, however, it is important to get professional help from an experienced lawyer immediately.
When either a business or an individual make an application in terms of chapters 7 or 13 they should never be under the impression that the application will be granted quickly and automatically. It is a long process and applicants are well advised to get a lawyer to deal with their applications. Lawyers specializing in this field can shield their clients from the worst stress.
Asking for a liquidation order is not a convenient way to get rid of financial obligations. The court will scrutinize the affairs of the applicant and will need to be absolutely certain that he cannot honour his financial obligations. A means test will be applied and the first priority of the court will be to make sure that the debtors do not suffer unnecessary losses.
As soon as a court receives an application a trustee is appointed to manage the entire process. The trustee is given wide powers. If the applicant is a business, the trustee may close the business and sell all the assets or he may sell the business as a going concern. In the case of individuals all their assets are sold on open auction and the proceeds will be distributed between the debtors.
Many applicants are shocked when they realize that a liquidation order does not cancel all their financial obligations. If they have secured loans, it remains their responsibility to pay it back. They will also have to honour their tax obligations and pay child support. It is customary to let the applicant keep crucial assets such as his car and some of his furniture.
The lawyer will make very sure that his client understands and accepts the serious consequences of liquidation before he will file the application. His credit record will be poor and he will not be able to apply for a loan for at least ten years. During the rehabilitation period his financial circumstances may be reviewed at any time. He will have to downgrade his lifestyle too.
Because a liquidation order can have such serious implications the lawyer will try to find alternative solutions. In many cases he will be able to negotiate with debtors and agree to new payment plans whereby the client will by smaller amounts over a longer period. In most cases such a solution is far better than a liquidation order.
Far too many people land up in the bankruptcy court because they fail to manage their personal finances and they incur debt by buying unnecessary luxuries. It is vital to have a sensible budget and to live according to that budget. When trouble does occur, however, it is important to get professional help from an experienced lawyer immediately.
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