The Misconception of the True Essence of Bankruptcy

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The Misconception of the True Essence of
Bankruptcy

• Many think that when a person has a financial
  problem, bankruptcy is the best solution.

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• Many think that when a person has a financial
  problem, bankruptcy is the best solution. In
  fact, some hide their assets before filing for
  bankruptcy thinking that they would be richer
  after bankruptcy for the hidden assets could no
  longer be subjected to creditors claims.

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Bankruptcy is only a solution of last resort when
all other options fail. Nevertheless, there are
some misinformed who filed for bankruptcy
although another options are still available. As
a consequence, they lost their assets including
house, cars, RRSPs and investments. And this is
so unnecessarily.
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The primary purpose of bankruptcy is to enable a
person who is loaded with debts (incurred legally
without fraud or misrepresentation) with little
assets to start life again without the burden of
forestalling collection activities from
creditors, collection agents or law suits arising
from non-payment of debts.
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Concerning the cost of filing bankruptcy,
everyone who files for bankruptcy would pay a
trustee fee regardless of income, assets and
liabilities of the person filing, contrary to
misconception that there is no fee in filing for
bankruptcy.
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When a bankrupt person has excess assets or
income, she/he may tells his/her friends and
relatives that filing for bankruptcy was free for
a trustee did ask for a fee. This is a source of
misconception, because trustee fee was in fact
paid from the excess assets or income.
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Before filing for bankruptcy be sure that it is
the best solution to solve your financial problem!
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