If you are thinking of filing for bankruptcy as an individual consumer, you usually have two choices available to you: Chapter 7 or Chapter 13. Chapter 13 involves proposing a repayment plan in which you will pay back at least some of your debt. 

Eligibility requirements may apply to either Chapter 13 or Chapter 7. However, according to Chron.com, if Chapter 13 is an option, it can offer you certain benefits.

1. Reducing your debt

Under a Chapter 13 repayment plan, you make payments to your bankruptcy trustee on a monthly basis over the course of three to five years. The bankruptcy trustee then distributes it to your creditors. You may not pay back all your debt during this repayment period. However, as long as you keep up your monthly payments, whatever you still owe at the end, which could be up to 90% of your original debt, gets discharged. This means that you no longer have to worry about it.

2. Stopping late fee accrual

One of the sad ironies of heavy debt is that when you cannot pay your bills, your creditors often charge you late fees so that you end up owing even more. When you file Chapter 13 bankruptcy, it prevents your creditors from charging you further late fees. Typically, the late fees you already owe do not count toward your debt consolidation and wind up simply erased.

3. Submitting one monthly payment

Instead of having a bunch of bills with different due dates, you make only one payment per month to your bankruptcy trustee. This makes it easier to keep track of what you owe and when. 

Filing for bankruptcy can be an intimidating prospect, but you need not feel intimidated by it. For many people, it is an effective way to get rid of debt and start over fresh.