As you weigh your options on how to deal with your finances, Chapter 7 bankruptcy stands out as a viable option to get out of debt.
Learning about the specific benefits to this form of bankruptcy can help you keep your budget balanced for the future.
Chapter 7 allows you a quicker way to make a fresh start, since this process only typically takes three to six months to complete. According to FindLaw, if you have a limited income and wish to avoid repossessions or defaults, declaring Chapter 7 bankruptcy allows you to liquidate your property. Both business owners and individuals who need help can file for this type.
You do not need any particular amount of debt to file for this version of bankruptcy, but there is a six year wait period between filings for Chapter 7. However, there are exceptions for some situations.
If you need to file again within that time period, you could obtain a Chapter 13 plan before the six year time limit for Chapter 7. As long as you follow the court rules regarding requests, you can easily avoid any issues with limitations on your filing.
State exemptions can help prevent you losing many things you own to bankruptcy. Any salary you make after filing for Chapter 7 bankruptcy is exempt from these rules. Having a line of credit and getting a mortgage is also typically still possible after filing.
Chapter 7 also helps shield you from aggressive tactics from lenders seeking repayment. Although some debts are unavoidable, the court usually waives many others once you file.