When all other options have been exhausted, bankruptcy may be the only way to resolve debt problems. Individuals and couples have two basic options when it comes to personal bankruptcy. Chapter 7 could eliminate all unsecured debts but isn’t the ideal choice for everyone, especially homeowners who want to keep their property. Chapter 13 offers more flexibility, but there are also drawbacks to choosing this type of debt relief.
When a person enters a chapter 13 debt repayment agreement, they may get more flexible payment arrangements than they would have been able to achieve by working with their creditors. Although it may take longer to pay off debts through bankruptcy, this flexibility may make the extended period of time required worthwhile.
Many people who qualify for chapter 7 bankruptcy opt for chapter 13 because this type of debt relief allows people to keep their property. They may be able to keep their house or car while they make up the past-due payments over time. In exchange for this privilege, people in chapter 13 have to devote all of their disposable income to reducing their debts. A bankruptcy attorney in Gainesville, GA could help a client choose which option might be best for them.
Filing for bankruptcy protection helps a person avoid foreclosure, repossession, and lawsuits. A credit report full of these derogatory records can make it difficult to get financing in the future even with a stable income. However, even though bankruptcy will be on the filer’s credit report, it is much easier to explain than a long list of lawsuits. Chapter 13 bankruptcy also shows potential lenders that a person is willing to sacrifice their disposable income for years in order to satisfy their debts. A bankruptcy attorney in Gainesville, GA might give their client advice regarding applying for new credit after their bankruptcy has been discharged.
There are pros and cons of using the bankruptcy code to relieve debt. It’s up to each person and their attorney to determine whether the pros outweigh the cons. Anyone who thinks this might be the right option for them should
