There are many reasons why people become burdened by debts, such as job loss divorce or medical condition. For people that feel overwhelmed by their debt, there is bankruptcy. In fact, for people struggling to pay their bills, bankruptcy provides and opportunity to get their finances back on track.
For people that are considering bankruptcy as an option, there are two approaches to filing for consumer bankruptcy, Chapter 7 and Chapter 13. Depending on your circumstances one or the other bankruptcy would be best for him or her.
For individuals that need a fast escape from debt, Chapter 7 is the best option. When a person claims chapter 7 bankruptcy, most of the debts that person owes discharge immediately. For people that do not own many valuable assets, using a Chapter 7 filing offers the best approach to bankruptcy.
For individuals who own valuable asset, such as a house that has substantial equity, Chapter 13 bankruptcy is probably the better option. Chapter 13 provides the debtor an opportunity to pay back the value of any excess equity there may be. The debtor’s debts are consolidated once he or she is under a repayment plan.
If you are not sure which is best for you, or you just need to learn, feel free to call us, we welcome your calls.