ECONOMICS (CBSE/UGC NET)

Detailed explanation-1: -Definition: When an organisation is unable to honour its financial obligations or make payment to its creditors, it files for bankruptcy. A petition is filed in the court for the same where all the outstanding debts of the company are measured and paid out if not in full from the company’s assets.

Detailed explanation-2: -By now you are likely wondering what alternatives to bankruptcy really exist. There are quite a few, and combining them might also be a solution. Depending on your situation, 4 options that might work for you are: consolidation loans, debt repayment programs, debt settlement options or a Consumer Proposal.

Detailed explanation-3: -Chapter 7 bankruptcy, also known as “liquidation bankruptcy” or “straight bankruptcy, ” is a legal process that allows qualifying debtors to get most of their debts discharged (wiped out). If you qualify for Chapter 7, you can get your unsecured debts wiped out, usually within 6 months of filing.

Detailed explanation-4: -Bankruptcy is a legal process or court order, while insolvency is a state of financial distress. Bankruptcy is a type of insolvency, but there are others. Bankruptcy isn’t the only way out of insolvency. Bankruptcy applies only to individuals and sole traders with unlimited liability.

Detailed explanation-5: -Debt Settlement. Debt Consolidation. Sell Assets. Credit Counseling. Borrow Money from Friends or Family. Find a Way to Earn Extra Income. Restructure or Refinance Your Mortgage. Lower Expenses Making Changes to Your Budget and Lifestyle. More items