When a financial crisis hits and you can’t pay your bills, filing bankruptcy might be your best option. Chapter 7 and Chapter 13 are the two most common types of bankruptcy in the United States.
Chapter 7: Liquidation
Given the choice, most people would prefer to file for Chapter 7 bankruptcy because it is a quick way to get rid of unsecured debts such as medical bills and credit cards. In Chapter 7, a trustee sells your nonexempt property to repay your creditors. Not everyone qualifies for Chapter 7 – it is designed for people who have little or no disposable income and don’t have any nonexempt assets they can sell to pay their bills.
Chapter 13: Reorganization
If you have too much income to qualify for Chapter 7, you can file for Chapter 13 bankruptcy. In Chapter 13, you use your disposable income to pay off your debt through a three- or five-year debt repayment plan. The advantage of Chapter 13 bankruptcy is that you get to keep your property during the repayment period, giving you a chance to catch up on your mortgage and other missed payments.
Get the Legal Help You Need
If you are ready to get a fresh financial start by filing Chapter 7 or Chapter 13, secure the services of an experienced bankruptcy attorney. Contact the law office of C. Taylor Crockett today.