chapter 7 bankruptcy Archives - Everday Resources

What Is Chapter 7 Bankruptcy?

Chapter 7 bankruptcy is called liquidation. It helps you by having you surrender some property or assets that can be turned into money. If you have no disposable income on hand to handle this massive debt, then you can file chapter 7. If your debt is discharged by chapter 7 bankruptcy, then you don’t have to pay that debt back. The money can then go somewhere else, and most debts can be discharged with few exceptions.

Filling can also increase the speed at which you overcome your debts, and can also stop debt collectors from taking action against you. That is very appreciated for people who are debt ridden, and it only takes around 100 days to finish. Your assets and credit will take a hit, but you will be debt free.

What Is Chapter 13 Bankruptcy?

If you want to file your debt but wish to keep your property, then you can file for chapter 13. If you have disposable income on hand, then this is right for you. It will stop any foreclosure processes on your home, and will allow you to get a handle on your mortgage payments. It also stops your debts from being collected if they are discharged under chapter 13.

Chapter 13 also allows you to make consolidated monthly payments with a solid 3 to 5 year plan. You will know exactly what to pay, and when you need to pay it. It is not as fast as chapter 7 bankruptcy, and can strain your budget. However, if you can keep up with the plan, you will be able to keep your property throughout the process.

Picking The Right One

If you are still undecided about which one is the best for you, then you should try to talk to a lawyer and see if they can help you make your choice. They will have your best interests at heart and will be able to answer any questions that you have. Filing for bankruptcy is something that is tough for every single small business owner, but you need to make sure that you are completing the process. By examining your situation before you start the filling process, then you can make the best decision.

Bankruptcy can be a trying time for any business, and you need to make sure that you keep a calm center amid all the turmoil. Debt, creditor harassment, and stress, can cause you to make rash decisions in the heat of the moment. One of those decisions is thinking that bankruptcy is the only option.

There are some alternatives to filing chapter 7 and chapter 13 bankruptcy, and some of them might be much better for you. They also all have a specific goal in mind.

Stop Debt Creditor Harassment

The phone calls, the emails, the lost wages… having creditors harass you is the worst, and can get very frustrating whenever you are already dealing with so much. If you want to stop the harassment, you don’t need to file for bankruptcy, and instead you can look into state and federal debt protection laws.

These laws protect you from abusive debt collector conduct, and you can easily bring them into play whenever you feel like the collectors are crossing the line.

You might even be able to negotiate with your creditors to get them off your back. You can offer up income or assets for sale, and can give you time to get back on your feet. Sometimes you can even settle your debt for less than you owe with this method, however it is still a good idea to have a lawyer on your side.

Talk To A Counseling Agency

A credit counseling agency can help you with the negotiation process by helping you repay your debts. They will negotiate on your behalf, and give you information about how you can improve your financial strategy. The agency will work with you to create a plan, and this plan allows you to repay your loans over time.

This allows you to pay off your debts over a period of time, without having ‘filed for Chapter 13 bankruptcy’ on your record. There are a few risks, but it can be an alternative in a pinch.

Instead of Filing For Bankruptcy, Do Nothing

If you physically cannot pay your debts, a good option is just to not pay them. If you are scraping the bottom of the barrel and are unable to make money in the future, then people might not be able to sue you for your debt. There’s nothing for them to take if they do. Unless you default on child support or government taxes, you can’t be arrested for not paying.

Plus, the basic essentials can’t be taken away from you by law, so while it won’t be a comfortable debt free life, it will be a life you can live.

Figuring Out Your Next Steps

Before you take on an alternative to bankruptcy, you need to talk to an expert. Alternatives aren’t always the best solutions, so make sure that you have a plan to avoid bankruptcy while still paying for your debt. You’ll be able to get out from under the weight of your debt soon enough, and then you can get back to living life.