Confronting the harsh reality of not being able to repay your debt which you took in sound mind is troublesome. Your only possible solution to this may be filing for bankruptcy. By contacting a bankruptcy attorney, you can understand your next step is to file under chapter 7 or chapter 13.
How to go about chapter 7 bankruptcy?
A chapter 7 bankruptcy goes on for about 6 months or less. In that time you are asked to settle as much as debt as possible and emit the rest. Here, you are asked to settle your debts by surrendering the assets that the court considers non-exempt. Necessary things that are required by you to live a quality life are considered exempt, for instance, the vehicle you use to go to the office, the place to live, and the furniture required will be considered exempt. The bankruptcy trustees will sell off your non-exempt assets and divide them among your creditors. Once these disbursements are settled, the remaining debt will be emitted. While it is in process, your creditors cannot add interest nor make any type of collection efforts. If done so, contact your legal counsel and the court will take it from there.
What are chapter 13 bankruptcies?
In this, you are given a time period of 3-5 years to pay off your debt, and the remainder will be discharged. Depending upon your circumstances, the court will allow you to pay off your debt by you or directly by your employer. For this duration, you are restricted to take any new debt without express permission by the court. Your creditors are not allowed to contact you and if they add interest to the balance or make collection efforts, immediately contact your attorney.
What all can be discharged in chapter 7?
Not all kinds of debt can be discharged under chapter 7, debts like taxes, child support, student loan, charges for criminal acts done on your part, or fines given out by the government cannot be exempted under chapter 7. Your legal counsel can walk you through the debts that can and cannot be exempted under this chapter.
Can all debts be discharged under chapter 13?
Yes, all debts that cannot be discharged under chapter 7 can be included in chapter 13 as well as credit cards and other consumer debts are protected in this chapter. The debts are prioritized and then paid off. The most important ones are first to be settled and the non-priority debts are settled last. If the latter is left after the time period is given by the court is crossed, they are exempted.
Recall that the objective is to lighten the monetary tension you’re under and run after a new beginning.
Call us at (888-297-6203) and ask questions if you are in doubt about what to do next and to understand both approaches. The best decision will finish the restless evenings and permit you to look toward a superior monetary future.