Every time a person files for bankruptcy the outcomes on their financial status is very apparent but possibly the hardest effects are linked to their ego.
Not many people will charge on a credit card or acquire loans with the goal of not paying them back.
Usually something happens in their life, like unexpected medical expenses or the loss of their job that finds them not able to meet their obligations. Effects of bankruptcy may range from short term to long lasting.
For almost all of those filing for bankruptcy, their greatest debt is likely to be unsecured, such as bank cards or medical bills. If the person is filing Chapter 7 bankruptcy, once the court approves the bankruptcy, these will just disappear altogether.
However, if there are secured debts, such as a car loan or a mortgage loan, it is possible the car will be repossessed and a foreclosure will be filed up against the home.
If you file for Chapter 13, you cannot choose which debts are included and which aren’t. All debts, secured and unsecured are listed and the entire amount of debt will be the amount where your monthly payments are based.
On the other hand, if you fail to make the necessary payments the bankruptcy court trustee allotted to oversee your case, will advise your creditors and your case can be terminated. If that happens you can try to file for Chapter 7 bankruptcy and hope to have it authorized by the court.
Most often, the first effect you’ll see is the fact your creditors stop calling you, provided you gave them the name of your bankruptcy attorney, but they will also stop allowing you to use your credit cards.
If your individual bankruptcy also incorporates medical bills your doctor or hospital may refer you to a different doctor and refuse to take you as a patient.