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Chapter 13 bankruptcy: is it the right choice for you?

On Behalf of | Jan 15, 2018 | blog |

California readers who are overwhelmed by debt may know that bankruptcy could be a reasonable option for them. Filing for bankruptcy may not be your first choice, but it could be a way to obtain a better financial future that is free from the threat of losing your home and the harassment from creditors.

If you are dealing with the possibility of losing your home to foreclosure or specific types of debt, Chapter 13 bankruptcy could be the right choice for you. Even if you believe that this is the practical choice for your individual situation, it is smart to have a complete evaluation of your case in order to fully explore all of your options. Filing for any type of consumer bankruptcy is a serious decision, and it is prudent to take care to know all of your options before you proceed.

Why should you choose Chapter 13?

Chapter 13, sometimes called the wage earners’ bankruptcy, provides you the opportunity to pay off your debts over time and according to a plan that you submit. While this type of bankruptcy takes longer than Chapter 7, there are benefits to this specific choice, including the following:

  • Chapter 13 allows you to keep most of your personal property, whereas Chapter 7 could require that you liquidate some of your personal property to repay debts.
  • You will have the opportunity to present your own plan to repay debts to creditors.
  • It can help you repay debts, including missed mortgage payments. Filing for bankruptcy will stop the foreclosure process.
  • A Chapter 13 bankruptcy filing will only stay on your credit report for 7 years while a Chapter 7 filing will stay on your credit report for 10 years.

Chapter 13 is not the right choice for everyone. No two situations are the same, and it is beneficial to carefully weigh the benefits of all consumer bankruptcy options available.

Who really needs bankruptcy?

Finding yourself in a place in which you are unable to manage your debts and make payments in a timely manner can be overwhelming. It can be hard to admit that you may need to file for bankruptcy, but there are times where this step is the most beneficial and the most practical.

You can take charge of your financial future, starting by learning more about the benefits of bankruptcy and potential bankruptcy alternatives. This step can halt contact from creditors, give you a way to pay off some debts and allow you to pursue a better tomorrow.