Some people who find themselves deep in debt feeling of bankruptcy. The debt elimination benefits of bankruptcy come at a high price .
Individuals who declare bank interruptcy do so under Chapter 7 or Chapter 13. Chapter 7 bank interruptcy completely liquidates debt and any assets related to it. Chapter 13 bankruptcy is different. Instead of liquidating debt it postpones your payments and help you plan how to pay back part of what you owe.
Credit is damaged as a result of bankruptcy proceedings for up to ten years. This applies to both Chapter 7 and Chapter 13 bankruptcies.
Some people have turned to bankruptcy into a way to easily pay the money they owe. In some cases, individuals have filed for Chapter 7 multiple times in an effort to rid themselves of incurred debt.
Some people tried to buy it. They decided to be taken away which is different from the bankruptcy process. That way, those possessions are not liquidated and the individual ends up paying very little to their creditors.
They are early less than the median income in their state. They are not eligible for Chapter 7 bank interruptcy.
In these proceedings, the court take into consideration a person & # 39; s financial situation and their debt in order to determine how much money they are realistically able to pay. Necessities like a rent or mortgage payment and utility bills are set for Chapter 13 bankruptcy filers. After this, the actual amount to be paid is determined and the rest is considered exempt.
Credit counselors can help you to make a plan for getting rid of debt without going through the bank interruptcy process.
Bankruptcy is not a simple or cheap process and should be used when all other efforts at eliminating debt have failed since bankruptcy causes long term damage to your credit.
