Ideally, when you want to file for bankruptcy to get rid of your debts having no other alternative, there are two types of bankruptcy available. These are Chapter 7 bankruptcy and Chapter 13 bankruptcy. Remember, you are not allowed to go for any type of bankruptcy as you wish. It is the experienced and qualified bankruptcy attorney near me will determine which is more suitable for your case considering all the influencing factors and covering all necessary aspects. It is essential for you as well as your attorney to abide by the set rules and regulations that govern the entire process.
Chapter 7 bankruptcy
In the bankruptcy court, this form is commonly known as ‘straight bankruptcy.’ This is the most commonly filed and favored for of bankruptcy amongst the two. In this process, there is a trustee appointed by the federal court to oversee sale of non-exempted assets, collect the proceeds and disburse the creditors with it. Any remaining amount is abolished after discharge. You cannot file for Chapter 7 bankruptcy certain types of debts such as student loans, court ordered child support and alimony. The consequences of it are significant as you may you’re your property and the information will stay in your credit report for ten years from the date of filing it.
Chapter 13 bankruptcy
This form is slightly different from the other wherein you are allowed to retain your property if you wish to repay the debt fully or partially. There will be a three or five year time given to you for making such repayment of the agreed repayment amount and plan. Even if you pay a portion of the total debt amount, it will be considered as discharged. It is for this reason and also for that fact that it will cycle off your credit report after 7 years make this a more favorable option.
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