What is Bankruptcy?
Bankruptcy is a legal process that allows individuals or businesses to obtain relief from their debt obligations. It involves a court-supervised process of liquidating assets or reorganizing debt in order to pay creditors. Depending on the type of bankruptcy, it can result in the discharge of certain debts or the repayment of debts over a period of time.
CHAPTER 7
Chapter 7 bankruptcy is a tool that you can use to eliminate your debt and get a fresh start. A Chapter 7 bankruptcy case lasts 4 to 6 months on average. Chapter 7 bankruptcy allows the filer to discharge (wipe out) most, if not all, of his/her unsecured debt.
CHAPTER 13
Chapter 13 bankruptcy is a useful tool to restructure your debt and wipe some debt out. A Chapter 13 bankruptcy consolidates your debt into an affordable monthly payment that is paid over a course of 3 to 5 years. Chapter 13 bankruptcy can get caught up in mortgage arrears, tax debt, delinquent car payments, child support arrears, and much more.
DO I NEED TO FILE FOR BANKRUPTCY?
Whether or not you need to file for bankruptcy depends on your individual financial situation. If you are struggling with overwhelming debt that you cannot reasonably pay off, bankruptcy may be a viable option to get a new financial start. However, it is important to consider the potential consequences and consult with a qualified bankruptcy attorney before making a decision.
