Glossary & Index

4 results were found:

Bad Debt

Credit used to purchase items that lose value or are no longer around when the bill arrives. These items include clothing, food, gasoline, and other goods or services that do not retain their value.

Bankruptcy (personal)

Debts are discharged because that person is not able to repay debts. Assets may be liquidated to pay creditors, depending on the type of bankruptcy filed. Both types of bankruptcy may remove unsecured debts and stop foreclosures, repossessions, garnishments, utility shut-offs and debt collection activities. Both types provide exemptions that vary by state and allow people to keep certain assets. Generally considered the option of last resort, a bankruptcy stays on an individual's credit report for 10 years.

• Chapter 13 Bankruptcy - The court approves a repayment plan that allows the individual to pay off a default during a three-to-five year period, rather than surrender any property.
• Chapter 7 Bankruptcy- Liquidation of all assets that are not exempt. Exempt property may include automobiles, work-related tools, and basic household furnishings. Some of the property may be sold by a court-appointed official -a trustee-or turned over to creditors. Debts can be discharged through Chapter 7 only once every six years. Also known as straight bankruptcy.

Bond

A debt instrument or IOU issued by corporations or units of government.

Budget

A plan developed by an individual for directing and controlling his or her money.