One of the first questions that many people have regarding Bankruptcy in Cincinnati OH is the difference between chapter 7 and chapter 13 bankruptcy. While both are a form of debt relief for individuals and couples, they work very differently. Choosing between chapter 7 and chapter 13 bankruptcy requires both extensive information and expert guidance. Here are a few guidelines that will help explain the benefits and drawbacks of both of these types of bankruptcy.
Chapter 7: Full Debt Relief, With a Few Exceptions
Chapter 7 bankruptcy is the type of bankruptcy that is best known, as it offers almost complete debt relief. In a chapter 7 bankruptcy, all of the individual debts (or joint debts in the case of a joint bankruptcy) are discharged. There are a couple of notable exceptions to this, including student loan debt and child support debt. Credit card debt, loans, and other personal debt can all be eliminated with a chapter 7 bankruptcy. Chapter 7 bankruptcy is a fresh start that allows people to get rid of the debt that is dragging them down. Chapter 7 bankruptcy is only approved in cases where a person’s income is simply not sufficient to pay their monthly obligations. For most people who are buried in a mountain of debt, chapter 7 bankruptcy is the best way to get a new start. In a chapter 7 bankruptcy, a filer is allowed to keep their home and their primary vehicle as long as they are able to continue making any payment obligations on those things.
Chapter 13: Partial Debt Relief, Based on What the Client Needs and Wants
In chapter 13 bankruptcy, a person can file for debt relief based on their individual needs. If a person has enough income to support paying their debts, they will pay at least part of those debts in a chapter 13 bankruptcy. Each creditor will enter into an agreement with the bankruptcy filer. This agreement specifies the amount of debt that will be repaid and how it will be repaid. In this type of bankruptcy, a person can keep as much property as their income can support if the creditors are willing to enter into agreements regarding the payoff of that property. Considering Bankruptcy in Cincinnati OH? Call to Meet R. Dean Snyder Attorney for a consultation anytime.
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