Are you looking for a bankruptcy solution to your financial trouble? It’s very common to ask if bankruptcy can help you get out of debt? The answer is, it depends. As a matter of fact, bankruptcy can eliminate or lessen your dischargeable debt but not all types of debt. The kind of debt you currently have and type of bankruptcy you need to file will have a huge effect on the process.
A lot of people experience financial difficulties at some point in their lives. When these circumstances happen, the most important thing a person can do is to remain calm. Panicking will not help at all. Ignoring the problem will make it worst and eventually will not solve your burden. In this way, you have to properly address the debt in a way that allows you to get a fresh start.
Bankruptcy is a big help for some people who are dealing with a large amount of debt. There are 2 types of bankruptcy that can be beneficial in your case, chapter 7 and chapter 13 Bankruptcy.
Chapter 7 is frequently selected that helps the filer eliminate debt. In this process, there is a liquidation. This means that you will lose some assets during the bankruptcy filing. Although, certain exemptions can be made to allow a person protect and keep certain assets. In chapter 7, the process can be done as fast as possible.
Chapter 13 is a process by which a person can reorganize a repayment plan for paying back their creditors. The time frame for this plan is between 3 to 5 years.
How Bankruptcy Can Help You Get Out of Debt?
In previous years, the word bankruptcy filing has lead people to relate this word with failure on financial obligation. Many Americans find themselves in the same scenario. There are families and business owners are also experience the same thing because of economy or other related problems beyond their control. When creditors started to call you continuously and couldn’t sleep at night worrying about your bills, it is indeed the right time to learn the options available for you. If you think you cannot afford to pay for a repayment plans with your creditors, filing chapter 7 may be the right choice for you. It will not only give you a relief from your financial struggle, it will also allow you to achieve a better opportunity to start a new and begin to restore your credit once more.
Know The Benefits
One of the main benefit of bankruptcy filing is that it ends the annoying phone calls from creditors, letters and all kinds of collection forms effectively. It also ends foreclosures and repossessions. Once the bankruptcy is filed, creditors are now required to stop all progress related to collection of debt. If you experience financial difficulties for some time and not fit to pay debt, your credit score will likely to get affected. When these debts are in the process of being eliminated because of bankruptcy filing, the credit score will stop to drop. In this way, you can now have a positive thinking to restore and improve credit score because you finally find a better solution to get rid of your debt.
Can Help You Survive with Chapter 7 or Chapter 13
While bankruptcy is often the last option for some people, sometimes it is the only way to fix your problem. Chapter 7 helps people hold onto their assets they need to survive such as car and home. If you think type of bankruptcy is not fit for your need and your family, chapter 13 may be the best one for you. This is ideal for individuals who have past due on their mortgage or car payments. It helps individual keep the things they need.
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