What are the differences between bankruptcy and insolvency? Find out what they mean and why you should be aware of them.

Bankruptcy and insolvency are legal terms that describe how an individual or business deals with financial problems. They’re used when someone cannot pay debts in full or on time.

What is Bankruptcy? 

 Bankruptcy is a legal process under which a person may be discharged from most of his/her debts.

Why Do People File For Bankruptcy?

Bankruptcy allows individuals to discharge some or all of their unsecured debts. When you file for bankruptcy, the trustee is responsible for managing your estate and liquidating all of your assets to pay off your debts. The trustee is also responsible for complying with the reporting requirements under federal securities laws and other laws applicable to corporations.

Know more on How to File a bankruptcy on a Step by Step Process

Can I Avoid Bankruptcy?

If you are facing financial difficulties, options are available to help you avoid bankruptcy. You might consider taking advantage to seek professional advice from one of our Financial coaches to start setting up your plans so you can avoid filing for bankruptcy.

Working with  LIT or a Licensed Insolvency Trustee can help you be assured of getting the most up-to-date and accurate advice about your financial situation. Book a discovery call today!