...to declare bankruptcy? Why are these factors important? 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. Chapter 7 bankruptcy can wipe out most of ones debts, but certainly not all of them. Certain kinds of debt are not covered by the terms of Chapter 7. Some examples of debts that must be paid after filing for bankruptcy would include child support, alimony, income taxes and penalties, student loans, and court ordered damages due to unfair and unrighteous acts. Bankruptcy courts handle your financial problems until the case ends. A court assumes control of all ones debts that are owed and all property that is not exempted. A trustee is appointed to be in charge of your debt. The trustee collects property that can be taken and sells it to repay some creditors. That property can be surrendered to the trustee, which can agree to pay the market value or one may choose to trade exempt property with nonexempt property. A small number of people actually lose property when filing bankruptcy. If a person changes their mind about filing for bankruptcy, they may ask the court to dismiss the case. At the end of the process, the court would discharge most of the debts and one is unable to file for another Chapter 7 bankruptcy for at least another six years. On the other hand, Chapter 13 bankruptcy is mostly used...
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...Research / Analysis # 2 Baker College 1. When reviewing the American Bankruptcy Institutes website I was researching the total number of bankruptcies in 2012, the total number of non-bankruptcies in 2012, and the total number of business bankruptcies in 2012. My findings concluded that the total number of bankruptcies in 2012 which consists of business and non-business fillings which includes the states and D.C. was 1,232,294 (ABI, 2013). The total number of non-business filings in the states and D.C. in 2012 was 1,232,294. The report shows that there were 811,789 non-business Chapter 7 filings and 352,553 non business Chapter 13 filings in 2012 (ABI, 2013). My reports also show that amongst the 57,527 business filings in 2012 that 7,760 filed for Chapter 11, 97,167 filed for chapter 7, 12,485 filed for Chapter 13, and 115 businesses filed for Chapter 15 (ABI, 2013). With the information provided we can conclude that more companies file for Chapter 7. Filing for Chapter 7 means that a business simply does not have the income to repay any portion of their debts. In this case many of the assets will have to be turned over, and this can make it hard for the business to continue to operate, and it may involve the liquidation of the business (All Law, 2013). Now chapter 13 came in second place with 12,485 filings, and with Chapter 13 this is usually the best option for businesses. There is no asset-sale in a Chapter 13, but businesses do need...
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...According to the IRS, ten percent of bankruptcy filings are fraud and less than one percent of those are convicted. Bankruptcy can be filed when a company or a land owner is unable to pay overwhelming debts. Sometimes people hide their money and assets, and file bankruptcy just so they won’t have to pay back the debts that they owe even though that person is fully capable of doing so, which is illegal. This is called bankruptcy fraud, which is federal white collar crime which can lead to a maximum of 5 years in jail, and a $250,000 fine. People that you would most commonly see commit this fraud are private citizens, small business owners, corporate CEOs, real estate agents, politicians, and loan officers. There are four very common types of bankruptcy fraud, which are the concealment of assets, filing multiple times, giving false statements, and bust outs. Bankruptcy can be a hard thing to do for someone. Almost anyone filing for bankruptcy is truthful, has good intentions and is hard working. Sometimes, no matter how hard you try, the job market, the loss of your job or the high interest rates can be too much for someone to meet. There are two types of bankruptcy that someone can have, which are straight bankruptcy, and reorganization. When dealing with straight bankruptcy, someone isn’t able to pay their debts, like car loans, credit card debts, or mortgage. This usually involves homeowners, which allows them to start with a clean slate. With reorganization, that person is...
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...2/17/15 English III 5th period Bankruptcy when you have bankruptcy you basically go bankrupt, meaning you give up all what you have to start all over. Bankruptcy is a legally defined status,in this research you will learn Why people file bankruptcy? What is the process of completing bankruptcy? and What happens after you file bankruptcy?. In the eighteenth century, "Debtors and creditors alike appreciated the value of the bankruptcy process. every colony and state permitted imprisonment for debt colonies and states occasionally experimented with insolvency status that released small and middling debtors from jail and apportioned their assets among creditors but did not discharge them from liability". "Bankruptcy was promoted as a benefit for creditors as well as for Debtors. it would allow creditors to intervene in person as the debtors assets for all creditors while the availability of discharge would induce debtor's not to waste their assets in futile efforts to avoid deptors prisons" Encyclopedia of the new American nation.ed. paul finkelman vol.1 detroit Most people file bankruptcy for many reasons for example theres medical bills, job loss, credit card companies, predators mortages and bill collectors. I find it interesting that the majority of people file bankruptcy on medical bills, most doctors are expensive now a days and then most insurance that we have now is crapy so I dont blame them to be financial The process of completing bankruptcy is alot its just 10 step which...
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...INTRODUCTION Bankruptcy is a legal status of an individual or someone who cannot pay back debts owed to creditors. Bankruptcy is mostly imposed by a court order, often initiated by the debtor. Bankruptcy is not the only legal status that an insolvent person or other entity may have, and the term bankruptcy is therefore not a synonym for insolvency. In some countries, including the United Kingdom, bankruptcy is limited to individuals, and other forms of insolvency proceedings (such as liquidation and administration) are applied to companies. A creditor can file a bankruptcy petition to the High Court against a person or persons who have failed to repay debts. Under Section 6 of the Bankruptcy Ordinance, the amount of debt in a creditor's petition must be equal to or exceed a certain amount and must be unsecured. Other than the Creditor's Bankruptcy Petition (legal action commenced by creditors), debtors can also institute bankruptcy petitions against themselves (i.e. Debtor's Bankruptcy Petition). PROCEDURES INVOLED IN WINDING UP A COMPANY BASED ON BANKRUPTCY. Firstly, a liquidator is appointed either by the company shareholders passing resolution or by the court making an order, then liquidator collects the assets of the company and pays creditors in order to priority. The liquidator also distributes any surplus fund to the share holders and hence the company is then formally dissolved. In Reinsurance Australia Corporation Ltd v Odyssey Re (Bermuda) Ltd (2001) 36 ACSR 348;...
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...Do Bankruptcy Laws unjustly favor Lenders? Intro Bankruptcy is a legally declared inability or impairment of ability of an individual or organizations to pay their creditors. Bankruptcy law provides for the development of a plan that allows a debtor to resolve his debts through the division of his assets among his creditors. Although the goal of the modern bankruptcy is to allow the debtor to have a “fresh start,” and to be granted relief of some liability, there haven’t been any regulators to protect consumers or debtors since the first Bankruptcy Law that the Congress passed in 1797 which lead to imprisonment of thousands of debtors. And it wasn’t till 1841 that the debtor could voluntarily go into bankruptcy and so avail himself of this privilege of discharge. The Federal Bankruptcy Act of 1898 had 3 principal objects in view: 1. To prevent preferences and ensure equality in payment as between the creditors of insolvent debtors; 2. To punish and discourage commercial fraud; and 3. To discharge honest debtors from their debts when overwhelmed by financial misfortune through no fault of their own. The act gave creditors collectively full power over the administration of insolvent estates and placed upon them the responsibility for enforcement of the act. New Legislation The new Legislation enacted by Congress called the Bankruptcy Abuse and Consumer Protection Act was intended to make it more difficult for debtors to file a Chapter 7 Bankruptcy under which most...
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...about disclosing bankruptcy to the public are unclear, and so companies are able to make their own decisions about when to disclose the fact that they are filing for bankruptcy protection. The Wall Street Journal analyzed the bankruptcy filings of 90 large public companies and found that 29 did not disclose their bankruptcy preparations in any way. A few collapsed too quickly to report, but most made the decision not to let the public know. Is that a bad thing? On one hand, a free market relies on transparency and honesty. Bankruptcy filings are material information and, as such, investors have a right to know that a company is in distress. On the other hand, filing for bankruptcy protection is intended to help the company get out from under debt and keep operating. Disclosure can work against that process. With the introduction of innovations such as credit default swaps, creditors are less likely to be motivated to work with the company. Furthermore, employees with mobility are likely to begin departing once they know the company’s future is in doubt. Investors have a right to know, while stakeholders have a right to their livelihood. Where do we draw the line (9)?” Corporate Bankruptcy Explained Bankruptcy is a judicial process to provide an individual or a business that no longer can pay its debts with relief from financial obligations. It distributes a debtor’s property equitably among creditors and enables the debtor to start afresh. Federal bankruptcy laws govern how...
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...survived bankruptcy? Corporate Financial Management Bus 607 By Marie Dawes Which Companies Have Survived Bankruptcy? According to Gerald S., bankruptcy is a generalized term for a Federal Court procedure that helps consumers and businesses get rid of their debts and repay their creditors (2014). If anyone can prove that they are entitled to it, the bankruptcy court will protect them during the bankruptcy proceeding. In general, bankruptcies can be categorized into two types: liquidation and reorganization. The U.S. Court of Bankruptcy (2015), states that among the popular proceedings are chapters 7, 11, 12, and 13, which individuals and businesses use to file. Chapter 7 bankruptcies normally fall into the liquidation category. This means that an individual’s own property can be taken away and sold in the process of liquidation in order to pay back the debts. Conversely, chapter 13 bankruptcies fall under the reorganization category, meaning that the individuals will probably be able to keep their property, but they must submit and stick to a plan that will allow the person to repay some or all of their debts within 3 to 5 years. A case filed under chapter 11 of the United States bankruptcy code is frequently referred to as a reorganization bankruptcy. Its bankruptcy proceedings are usually employed by struggling businesses as a way to get their affairs in order and pay off their debts. In addition, some individuals also file for chapter 11 bankruptcy when they...
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...Solyndra was granted this loan in 2009, with a total grant amount of $535 million and they were the first to receive the loan since the program had debuted in 2005. Solyndra’s problems began right after receiving the $535 million grant as they were already struggling financially. In August 2009, about two years after receiving the government energy grant, Solyndra files for Chapter 11 bankruptcy. Solyndra “will only be paying back about $24 million of $535 million loaned by the U.S. Government.” ("Solyndra Bankruptcy: Solar Panel Company Won't Pay Back Most Of Its $527 Million Government Loan ", 2012).This would mean bad news for the investors. After Solyndra filed bankruptcy, it caused them to lay off all of their workers which created even further legal issues for the company. Solyndra had to file bankruptcy due to the fact, production was becoming too expensive for them and the solar panel prices were increasing drastically. As a result from this, Chinese manufacturers were able to put Solyndra out of business. Furthermore, Solyndra faced several legal issues. Prior to filing bankruptcy, Solyndra was being investigated by the federal criminal investigations (FBI) that was through the United States Attorney’s office & Department of Justice. Solyndra was being investigated by the FBI to see if the executive of the company had broken any laws when they “secured the $535...
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...Adelphia Communications’ Bankruptcy Bankruptcy The case talks about the situation Adelphia went through after the governance problem and fraud they had that led them to bankruptcy. Adelphia being a family owned company; by April 2005 they decided to sell out the remaining assets of the company to the one of the other 3 big cable companies; Time Warner, Comcast and Cablevision; each one of them offered different amount in the bid, nevertheless the company had to analyze how certain each offers were, how probable was any of them to pull out the offers as well as what to do with the money they would get in case the judge let them do the sell. Family Control Adelphia was founded and managed by Rigas family, the case talks about how the company after 1985 decided to go public in order to acquire the capital investment to expand and become one of the biggest cable providers in the country. Nevertheless the Rigas family managed to keep almost full control of the company by keeping special type stocks with decision making power in the board. The company kept being managed by the funding family as well as the family keeping some of the cable assets for themselves in separate private partnerships and continuing to buy properties privately as well as for the company. The case explains how the privately owned assets of the family were managed by already-public Adelphia Corp by some management agreements and with this the expenses of such assets were consolidated with the expenses...
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...on your first day you see many stands with credit card companies or banks who are offering to take you in to their company. They don’t do it because they want to help but because they know that they can get money from student. When you are in college you may not have a lot of money and so you get a credit card and use it because you think it won’t hurt you. Therefore they get the student with the interest which they can not pay because if they had extra money then they wouldn't have had to use the credit card. Credit card companies also have another type of people that they target and maybe more than college students which is people who have already filed for bankruptcy. They go after people who have filled for bankruptcy because once you file for it once then you can’t do it again. Of course the reason most people are bankrupt in the fist place is because of debt with credit cards or loans. So then they already no that they get addicted to the credit cards once they see them and can use them. Some people learn their lesson the first time that they go in debt or file for bankruptcy but not all because the ones that don't learn are in to more of a mess than before and after the second time they won't come out. All Banks and credit card companies want is your money. There first criteria for hiring is that you must know how to...
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...REPORT ON JUDICIAL REVIEW Of BANKRUPTCY LAWSUIT OF PT TELEVISI PENDIDIKAN INDONESIA (TPI) By: FABIANUS PRIJO SAMBODO 2013 BUSINESS LAW & ETHICS – LEGAL BANKRUPTCY ANALYSIS BACKGROUND Bankruptcy is a legal status of a person or organization that cannot repay their debts to creditors. In most jurisdictions, bankruptcy is imposed by a court order, often initiated by the creditor. Bankruptcy is not the only legal status that an insolvent person or organization may have, and the term bankruptcy is therefore not a synonym for insolvency. Bankruptcy lawsuit sometimes happens to many companies, when they can not pay their overdue debt or can not re-structure their liabilities to at least two of their debitor. In Indonesia, there are many of bankruptcy lawsuits, and one of the interesting bankruptcy cases happened at PT. Cipta Televisi Indonesia that ussualy known as a company who owned the Indonesian Educational Television (TPI). Bankruptcy as a means of debt settlement certainly has some direct and indirect effects on all parties that have an interest in the assets of the debtor declared bankrupt. Generally, if the debtor is a legal entity, the interests of the debtor, creditor and shareholders will be affected. For example, the declaration of bankruptcy by a company will negatively affect its shareholders' position in the liquidation process. Pursuant to Indonesia's Private Law, secured, preferred and unsecured creditors have different privileges against the assets of the debtor...
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...Bankruptcy Fraud By Robyn Carter Forensic Accounting Data Analysis Bill Makkkawi October 13, 2009 Bankruptcy Fraud What is Bankruptcy? Bankruptcy is a way for individuals or businesses to satisfy debts. There are four types of bankruptcy. There is Chapter 7 which is a complete liquidation for individuals. Chapter 7 bankruptcy liquidates assets that are not exempt and uses the proceeds to pay creditors. In this bankruptcy creditors may be paid in full or a percentage based on the assets that were available. There is Chapter 11 which is for a business. Chapter 11 allows a business to reorganize its operation and finances so that it can pay its creditors. Sometimes in Chapter 11 another entity may take over the original entity in the reorganization. Creditors are told to give the entity time to reorganize and pay the debts. Then, there is Chapter 13 which is reorganization for individuals. Chapter 13 gives individuals a chance to pay creditors over 3 to 5 years through a Bankruptcy Trustee. Most assets can be kept depending on what percentage of the debts will be paid. If the debtor is paying the creditors in full then they would be able to keep all of their assets. This is only available for debtors with verifiable disposable income. The last type is Chapter 12 which is for farmers and fishermen (LII / Legal Information Institute). After completion of whichever chapter used, the creditor gets a “fresh start”. White Collar...
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...Business: Undercapitalization and Bankruptcy Robert Solomon AIU Online Business: Undercapitalization and Bankruptcy There exists many ways to succeed and the world of business is certainly one of them but any time one opens oneself up to risk, the possibility of failure rears its ugly head. Genius it is argued though is when preparation meets opportunity. The first thing to do before setting out on the uncharted seas of financial security is to make sure you are aware of the dangers and pitfalls. The road is rough and has laid waist to many who have tried before you so be sure that you have what it takes, financially and intellectually. Fortunately there are solutions to this problem, albeit the people you will need to talk too are few and far between, it is good advice before you start that will give you that edge when the going gets rough and the pizazz to ride the crest of the wave when things go well. Business: Undercapitalization and Bankruptcy While there are many reasons to cling to the security of the hourly wage paycheck, the hopes and dreams of personal freedom is something that we, as humans, still crave. In this particular case, that freedom leads to the status of the self-employed businessperson. The problem is that just wanting success is never enough to accomplish it. Although freedom leads to self-sufficiency in an ever-changing, increasingly global market, the mere desire for success is a delusion in terms of real-world achievement. So the real question...
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...Background: On September 15, 2008, Lehman Brothers Holding, Inc. filed a petition in the US Bankruptcy Court for the Southern District of New York seeking relief under Chapter 11 of the US Bankruptcy Code. With total debt close to $800 billion, Lehman was the largest US bankruptcy in the history. Lehman’s share lost over 90% of its value on the announcement date and the Dow Jones Industrial index closed over 500 points down from the previous day, one of the single largest one-day point drops since September 11, 2001. Immediately in the aftermath of Lehman’s bankruptcy, over a hundred firms disclosed their financial exposure to Lehman. Lehman’s collapse, soon became the international economic crisis which affects the different aspects of the regional economic worldwide. The seeds of the crisis can be traced to the low interest rate policies adopted by the Federal Reserve and other central banks after the collapse of the technology stock bubble. In addition, the appetite of Asian central banks for (debt) securities contributed to lax credit. These factors helped fuel a dramatic increase in house prices in the United States and several other countries such as Spain and Ireland. In 2006, this bubble reached its peak in the United States and house prices here and elsewhere started to fall. The fall in house prices led to a fall in the prices of securitized subprime mortgage, affecting financial markets worldwide. In August 2007 the interbank markets, particularly for terms longer...
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