The Differences In The Types Of Bankruptcy
Sometimes you get into such a bad financial situation that you cannot get out on your own. If you are struggling to pay your bills every month and you have unplugged your phone to stop the phone calls from your creditors, it might be time to start thinking about hiring a bankruptcy lawyer. In fact, it might be a good idea to consult with a bankruptcy attorney before you are even sure what you want to do about your financial situation.
A legal expert can go over your options and tell you if you are even a good candidate for this. As an added option, many legal experts do not charge a fee for the initial consultation. You will only have to find a way to pay them once you have decided to definitely go through with the process. There are two different options for you if you have decided to look into filing bankruptcy. One is called Chapter 7 and the other is called Chapter 13. How you should file will depend upon your personal situation, your assets and your income. Your legal representative will discuss your options with you. Before talking about any kind of filing it is important to note that it will appear on your credit history for seven to ten years, depending on what you file. Chapter 7 remains for ten years, but a Chapter 13 is removed from your record after seven years. However, you should also understand that if you cannot pay your bills on time without filing bankruptcy, your credit will likely be ruined anyway.
Typically, people who do not have many assets file for a Chapter 7. In this case, you will surrender many of your non-exempt assets and they will be sold. The proceeds from the sale are then sold and will be used to pay people that you still owe money. There are many assets that are exempt from this sale process and in many cases; it excludes your home and car. However, it is important for you to consult with an attorney about this matter. At the end of the process, any debts that are remaining are considered to be settled. However, there are some debts that cannot be handed in this manner. Those include any court orders that have been delegated by the court system such as alimony, child support, etc.
Chapter 13 is sometimes called "reorganization or payment plan" bankruptcy. This is the typical route for people to use if they have properties or investments and they do earn a regular paycheck. If you file this type of Chapter, it means that there will likely be a repayment plan set up. You will be required to pay a certain portion of your debt for three to five years. At the end of the term that was set up, your remaining debts will be discharged.
Filing for bankruptcy should be considered a last resort. However, if you find yourself getting deeper and deeper in debt, it may be something you should consider. It can give you a chance to "start over".
A legal expert can go over your options and tell you if you are even a good candidate for this. As an added option, many legal experts do not charge a fee for the initial consultation. You will only have to find a way to pay them once you have decided to definitely go through with the process. There are two different options for you if you have decided to look into filing bankruptcy. One is called Chapter 7 and the other is called Chapter 13. How you should file will depend upon your personal situation, your assets and your income. Your legal representative will discuss your options with you. Before talking about any kind of filing it is important to note that it will appear on your credit history for seven to ten years, depending on what you file. Chapter 7 remains for ten years, but a Chapter 13 is removed from your record after seven years. However, you should also understand that if you cannot pay your bills on time without filing bankruptcy, your credit will likely be ruined anyway.
Typically, people who do not have many assets file for a Chapter 7. In this case, you will surrender many of your non-exempt assets and they will be sold. The proceeds from the sale are then sold and will be used to pay people that you still owe money. There are many assets that are exempt from this sale process and in many cases; it excludes your home and car. However, it is important for you to consult with an attorney about this matter. At the end of the process, any debts that are remaining are considered to be settled. However, there are some debts that cannot be handed in this manner. Those include any court orders that have been delegated by the court system such as alimony, child support, etc.
Chapter 13 is sometimes called "reorganization or payment plan" bankruptcy. This is the typical route for people to use if they have properties or investments and they do earn a regular paycheck. If you file this type of Chapter, it means that there will likely be a repayment plan set up. You will be required to pay a certain portion of your debt for three to five years. At the end of the term that was set up, your remaining debts will be discharged.
Filing for bankruptcy should be considered a last resort. However, if you find yourself getting deeper and deeper in debt, it may be something you should consider. It can give you a chance to "start over".
Source...