The fact of the matter is, no one enjoys the idea or looks forward to filing bankruptcy. Regardless, there are certain situations when finances and debt become unmanageable and the burden is just too great. There are many reasons people seek out a bankruptcy attorney. You can find yourself with an unexpected loss of employment, out of control health care expenses, unanticipated and unavoidable expenses, a failed business, or underperforming investments.
Nonetheless, once you have concluded bankruptcy is the right answer, you must decide which type of bankruptcy will be the most advantageous. For the individual. or small business owner, the choices are either a Chapter 7 bankruptcy or a Chapter 13 bankruptcy. Between these options, there are many reasons why Chapter 7 bankruptcy could be the best option for you. In most instances, Chapter 7 tends to be faster than Chapter 13, and you will likely be able to keep all or most of your property. Moreover, if you qualify for Chapter 7, you will not have to pay back your debts once discharged.
The normal Chapter 7 concludes within 3 to 6 months, while Chapter 13 bankruptcy will have you completing a three to five-year repayment plan. This highlights the big advantage of Chapter 7. At the end of the process, you can emerge debt-free. However, there could be certain exceptions, such as continuing to pay a mortgage or your car loan. Moreover, some debt cannot be discharged, like taxes, student loans, and child support.
Unfortunately, not every person is eligible for Chapter 7 bankruptcy. Therefore, if you don’t meet the income requirement, you could find yourself in a Chapter 13 repayment plan. If you would like to talk about filing Chapter 7 over Chapter 13, or need more information, please contact us.