Chapter 7 Bankruptcy allows qualifying debtors to eliminate most kinds of unsecured debt. Unsecured debt includes: credit cards, medical bills, most personal loans, old tax debt, some judgements, and deficiencies on repossessed vehicles.
Chapter 13 is a very low interest debt repayment through which the filer is expected to pay off debts in monthly increments over a five-year period. Debts typically consolidated can include: mortgage arrears, vehicle loan balances, student loans, credit card debt, and other unsecured debts.
Although the word “liquidation” may sound intimidating, the truth is very few people who file for Chapter 7 bankruptcy end up surrendering assets in this way. Most often, the bankruptcy trustee determines that a no-asset case exists, meaning that the filer has no assets from which creditors can benefit. Another important factor is that certain assets, such as a filer’s home or vehicle, are exempt from liquidation up to certain values. What this means is that Chapter 7 bankruptcy typically allows filers to keep their home and vehicles.
As long as your car and mortgage payments are current, and you own no significant equity in your property, our law office should have no problem arranging for you to reaffirm these debts while continuing to make timely payments. Put another way, you can file for Chapter 7 and still keep your house and automobile.
After filing for Chapter 7, your credit rating may suffer temporarily, it can be rebuilt quickly and easily.
Protection of your Home and Vehicles: Chapter 7 allows you to protect equity in your home (up to $627,000), vehicles, household furnishings, electronics, and retirement accounts. The Trustee rarely seizes your assets if you choose a qualified Bankruptcy Attorney who prepares your bankruptcy correctly.
Fresh Start: With a Chapter 7 bankruptcy, you can wipe out your credit card bills, payday loans, cash advance loans, personal loans, medical debt, vehicle repossession debts, old tax debt and even some government fines. With this discharge, it allows you to truly start fresh and make a budget going forward of all your essential bills.
Rebuilding of Credit Score to 720 or higher: Chapter 7 bankruptcy take about 4 months to be completed, from the moment you retain my office to the final discharge of debt. After you obtain that discharge of your unsecured debts, you can immediately begin rehabilitating your credit score. You can rebuild your credit score by applying for and using credit cards responsibly, continuing to pay on your installment loans and becoming on authorized user on another individual’s credit card with a high credit score.
Qualify to Buy a Car or Home: Many people think you can never buy a new car or home after filing a Chapter 7 bankruptcy. This is simply not true. You are eligible to finance a new vehicle as soon as your debts are wiped out and your bankruptcy case is closed. You can purchase a home 1 year after filing for bankruptcy.
Wage garnishment can be stopped.
Lawsuits over money can be stopped.
Harassing phone calls can be stopped.
Your credit can be repaired.
A bankruptcy isn’t forever.
Some people with higher incomes do not qualify for Chapter 7 but are still eligible for bankruptcy. A Chapter 13 is a good option for debtors who can afford a predictable monthly payment. While you are in a Chapter 13 debt repayment plan, creditors may not pursue collection actions against you, and they are required by a federal bankruptcy court to adhere to the terms of the repayment plan. Because the plan is designed with your budget in mind, you will never experience sudden jumps or changes to your repayment amount.
Chapter 13 typically takes longer to complete and entails more requirements than Chapter 7; however, it is better if you have a consistent source of income and specific assets you wish to retain, such as a home or a small business.
Debt consolidation done safely: While many businesses claim to offer debt consolidation services, they often make matters worse for their indebted clients. You can still be sued even while making payments to these types of companies. You can never be sued while in a Chapter 13 bankruptcy approved by the federal court.
Stopping foreclosure indefinitely: If your home is in foreclosure, a Chapter 13 bankruptcy filing will stop the foreclosure any time prior to the sale and allow you to repay your mortgage arrears through your Chapter 13 bankruptcy. You will remain obligated to make all future mortgage payments directly to the mortgage company, but it may not foreclose to collect any outstanding mortgage payments. If you have equity in your home, you can file a Chapter 13 bankruptcy, protect your equity, and repay your mortgage arrears over a five-year period.
Saving your vehicle from repossession: If your car is in danger of being repossessed, a Chapter 13 bankruptcy will stop the finance company from repossessing your car. Your past-due payments and the entire balance on your vehicle loan will be consolidated into your Chapter 13 repayment plan which you will complete within five years. The vehicle finance company will no longer be able to repossess your car, and you will no longer have to make direct payments to the finance company. The only payment to be made is to your Chapter 13 trustee.
Protecting co-signers from collections: If you file for Chapter 13 bankruptcy, the co-signers to your loan receive the same protection that you do. This means your co-signers will be protected from aggressive collection activity, and all creditors must wait to be paid through your repayment plan.
Give me a call and let’s talk about your options and create a path towards financial freedom, today!