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The counterparty is called a creditor. When the counterpart of this debt arrangement is a bank, the debtor is more often referred to as a borrower. If X borrowed money from their bank, X is the debtor and the bank is the creditor. If X puts money in the bank, X is the creditor and the bank is the debtor. It is not a crime to fail to pay a debt.
Generally, the rights of secured creditors to their collateral continues, even though their debt is discharged. For example, absent some arrangement by a debtor to surrender a car or "reaffirm" a debt, the creditor with a security interest in the debtor's car may repossess the car even if the debt to the creditor is discharged.
The first party is called the creditor, which is the lender of property, service, or money. Creditors can be broadly divided into two categories: secured and unsecured. A secured creditor has a security or charge over some or all of the debtor's assets, to provide reassurance (thus to secure him) of ultimate repayment of the debt owed to him ...
As part of Chapter 7 bankruptcy, your credit card debt is typically discharged immediately. On the other hand, Chapter 13 bankruptcy focuses on reorganizing your debts.
Debt restructurings are typically handled by professional insolvency and restructuring practitioners, and are usually less expensive and a preferable alternative to bankruptcy. Debt restructuring is a process that allows a private or public company - or a sovereign entity - facing cash flow problems and financial distress, to reduce and ...
A bankruptcy discharge is a court order that releases an individual or business from specific debts and obligations they owe to creditors. In other words, it's a legal process that eliminates the debtor's liability to pay certain types of debts they owe before filing the bankruptcy case.
Key takeaways. There are two common types of bankruptcy: Chapter 7 and Chapter 13. Filing for bankruptcy is a time-consuming process that can take years to stop affecting your finances.
Chapter 13 bankruptcy (debt restructuring): A Chapter 13 bankruptcy involves setting up a new repayment plan to pay back all or some of what you owe. Once the repayment plan ends, any remaining ...