People file for bank interruptcy because they have good reasons that should not embarrass the debtors. They lose a job, They have high medical bills, their home is devalued because of the economy, lack of proper educational training, family issues and for other reasons. All of these reasons, with bad luck, can happen to most anyone.
Sometimes just claiming credits that you are contemplating a chapter 7 bankruptcy, especially if you retain a bankruptcy lawyer, can help persuade stableborn creditors to make more reasonable settlement offer. When settlements can not be reached, here are some of the pros and cons for filing a Chapter 7.
Pros of Filing a Chapter 7 Bankruptcy
Quick Process: If everything goes smoothly, meaning that creditors do not file objections, the whole process taking takes about six (6) Filing a chapter 7 need it credit counseling course, file a petition, and attend a credit & There is no file objections. There is no debtor from the debtsor the most burdened. .
Less expensive: The process is less expensive than filing a chapter 13 or intensive debt counseling. The main costs are administrative costs and the costs for your bank interruptcy attorney.
The attorney is getting paid to have your petition has all the necessary information, addressing all issues raised by the creditors and trustees, attending the creditor 's meeting with you and making sure the discharge goes through.
The attorney will also explain your options after the bankruptcy such as steps you can take to get your credit back on track.
Debts are discharged: You can focus on getting more income and use the money you earn / get to pay your necessary bills.
Discharged debts are your chance at a fresh start.
Can reapproval debts: If you have a car or some asset you really want to save, you may be able to enter into a termination agreement.
This agreement means that you will keep your car (or other asset) but you will continue to pay the monthly payments and you will also pay the arrears.
Confirmation agreements are usually used for obligations where the creditor has a security interest in the item.
Less hearings: A Chapter 13 bankruptcy takes up to 3 to 5 years. I am afraid to have a more than a creditor. Your plan to pay off your debts.
A chapter 7 Bankruptcy is usually just one hearing - a creditor 's meeting. The meeting is often very short in time.
No wage garnishment: Because there are not discharged, there 's something right there for credits to garnish your wages because you do not owe the money.
Cons of Filing a Chapter 7 Bankruptcy
Before filing a Chapter 7 bankruptcy, debtors will want to explore debt settlement and debt counseling options to see if there is any way they can avoid filing a formal bank interruptcy.
Debtors will want to consider a Chapter 13 if they have a home or car they want to save and Chapter 7 is not an option.
These are some of the main reasons debtors will want to avoid filing a Chapter 7 bankruptcy:
Personal embargo: Most people who have good humorous happiness. They are filthy and there is a good reason. many people quite uncomfortable. My overall advice in this department would be not to worry at all about it as it & # 39; s rarely if ever found out.
Can not save your home: The main concern most debtors have not enough to save it, then the home will have sold and the debtor will have to find a new place to live
Can not save your car and other secured assets: Just like with a home, anyone who has a security interest in your car, tools or other assets will want to try to get their money back.
If you 're reasserting your collateral and selling it. If you' re losing your car / asset, then you will lose the car / asset.
In the end, you 'll have to accept both the pros and the cons of chapter 7, but the end result of a fresh start outweighs the consful as you & # 39; ll be in a position to really get your life and finances back in order.
