The process of filing for bankruptcy can be very complex and difficult. However, once you start to understand how bankruptcy works and the different types then some of the stress of initiating the process will be eliminated. It is really important to take a few minutes and learn about bankruptcy to make sure that it is right for you. The best and most reliable source of information is an Arizona bankruptcy attorney. What is Chapter 7 and How Does it Work:
Chapter 7 bankruptcy provides a means for a fresh start for those who are in dire financial straits. Most of the consumer filings today are for Chapter 7 bankruptcy. It is often times referred to as liquidation because the debtors take all of their assets that are not exempt and sell them to distribute money to the creditors. While this may seem a bit troubling, the key is that they are only required to sell non-exempt items, so often times they can go through chapter 7 without having to lose any of their assets.
It is important to find out what types of debts are discharged by Chapter 7 to see if it will even benefit you. For the most part Chapter 7 can discharge medical bills, credit card debt, unsecured debts, and civil judgments. There are many things to consider when it comes to deciding whether or not bankruptcy is right for you, and the decision should not be made without first consulting an Arizona bankruptcy attorney.
What is Chapter 13 Bankruptcy and How is it Different:
The main difference between somekeywordand 13 is that with Chapter 13 bankruptcy the debtor actually repays some or all of the debt. A payment plan will be outlined by the court and it usually takes place over 3-5 years. The court will monitor the debtor and creditor over this period of time to ensure that things are going smoothly. Once you decide that Chapter 13 is right for you, you will need to set a responsible budget that you can live with.
Chapter 13 can also help you to avoid home foreclosure by putting an automatic stay on things like your home or car. In order for you to be able to qualify for somekeyword you have to have an income substantial enough to cover both the payment plan and your regular monthly expenses. Chapter 13 can help those with excessive back taxes, child support, and even eliminate penalties associated with late payments and such. Ultimately Chapter 13 can help to restructure debt by creating a payment plan that is manageable for the debtor.
John N. Skiba Bio: I am a consumer somekeyword focusing on consumer filings under Chapters 7, 11, and 13 of the Bankruptcy Code. I also handle Fair Debt Collection Practice Act cases to stop aggressive creditors.
I have dedicated my legal career to helping those who are struggling with debt and financial set backs. Many are unaware of the protections and relief that the law provides in rebuilding their financial lives.
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