Not long ago, this blog discussed the elements of a Chapter 7 bankruptcy case. Chapter 7 bankruptcy can be an important tool for individuals who find themselves overwhelmed by debt. However, not all debtors may wish to liquidate their assets in order to pay off their creditors and, for this reason, they may look for another option to help them find financial freedom.
An alternative option to Chapter 7 bankruptcy is Chapter 13 bankruptcy. This form of bankruptcy does not require a debtor to sell off their possessions and, in fact, often allows them to keep assets, such as their personal vehicles and homes. Under a Chapter 13 bankruptcy, a person creates a repayment plan that pays off the loans they owe to their creditors and their repayment plan may extend as long as five years into the future.
Not every debtor is eligible for Chapter 13 bankruptcy and its protections. If a person does not make enough money to take care of themselves and pay off their creditors under the terms of their repayment plan, then it may not be possible for them to use the Chapter 13 process. Additionally, filing restrictions may prevent a person from using Chapter 13 to eliminate their debts if they have previously used the process.
One of the best ways to learn about personal bankruptcy options is to discuss them with a bankruptcy attorney. Though it can be overwhelming to confront one’s outstanding debts, the bankruptcy process was designed to give individuals a legal method to manage their finances and begin their lives on solid financial footing.
Disclaimer: The information in this blog post (“post”) is provided for general informational purposes only, and may not reflect the current law in your jurisdiction. No information contained in this post should be construed as legal advice from Sheehan Barnett Dean Pennington Little & Dexter, PSC or the individual author, nor is it intended to be a substitute for legal counsel on any subject matter. No reader of this post should act or refrain from acting on the basis of any information included in, or accessible through, this Post without seeking the appropriate legal or other professional advice on the particular facts and circumstances at issue from a lawyer licensed in the recipient’s state, country or other appropriate licensing jurisdiction.