For people experiencing financial hardship, Bankruptcy is a legal method for eliminating debt to obtain a "fresh start." In many cases, bankruptcy means the elimination of the debt that you owe to your creditors. There are two primary forms of Personal Bankruptcy: Chapter 7 bankruptcy and Chapter 13 bankruptcy.
HOW DO I KNOW IF BANKRUPTCY IS RIGHT FOR ME?
If your creditors are attacking your assets and income and you are in overwhelmed with debt, consider the "fresh start" filing bankruptcy may provide.
WHAT IS CHAPTER 7 BANKRUPTCY?
This is often referred to as "straight bankruptcy" and is the most commonly filed form. In most cases, people filing for Chapter 7 bankruptcy do not have to repay any of their debts.
WHAT IS CHAPTER 13 BANKRUPTCY?
A person filing under Chapter 13 bankruptcy proposes a 3 to 5 year repayment plan to creditors, offering to pay off all or part of the debts from future income. The amount to be repaid is determined by several factors, including the person’s disposable income. To file under Chapter 13, you must have a "regular source of income" and have some disposable income. Most people file Chapter 13 to avoid foreclosures or repossessions. Chapter 13 allows you to repay mortgage delinquencies over 3 to 5 years.