In the end you will be given two choices – chapter 7 or chapter 13. Yes, these two are the most popular forms of bankruptcy. A Chapter 7 Bankruptcy Attorney will tell you to go for chapter 7 instead of chapter 13. Chapter 7 gives you the golden opportunity to get rid of most your debts. You can avoid your credit card debt, personal loan and even vehicle loan. This is an effective way of dealing with your financial status. However, there is one catch with this type of bankruptcy. You must establish that you are eligible for chapter 7. This means, you need to establish that you cannot pay the debts because you don’t have the means. The test which you need to take is called means test. Once you have passed this test you can file for chapter 7.
Need for a Chapter 7 Bankruptcy Attorney
Well, it is imperative that you get legal advice. If you think hiring a lawyer will be just another expenditure which you don’t want to face, you need to think again. Though you are allowed to file your own bankruptcy, you would need some guidance. Here the advices of friends or internet will not work because each case is different and one wrong move can get your application rejected.
Benefits of Chapter 7
There are countless benefits of chapter 7. The first and biggest benefit is the luxury of being able to making a fresh start. With chapter 7, some of the debts get eliminated. This automatically gives you a chance to make a new life with a new financial scheme. However, here too you will face one drawback. There are some loans which remain even after chapter 7 bankruptcy is approved. You will have to pay your student loan. You will not be able to avoid alimony or child support. Other than these, other loans usually get nullified.
With chapter 7 you get the chance to keep your income. This luxury might not be available in any other kind of bankruptcy process. If you acquire property after filing chapter 7, you will be able to keep it. However, under the bankruptcy law, the proper that you acquire within 3 months of filing bankruptcy might be included in bankruptcy estate.
Chapter 7 does not require you to repay the debts. Yes, this is one of the benefits of the bankruptcy type. You will not be asked to pay the debt back, unlike chapter 13. Therefore, you would not require any repayment plan.
Quick discharge of all your debts makes chapter 7 a preferable type. After your filing is approved, the court does not take time to discharge you from the debts. This means you will be able to avoid the harassment and lawsuit which the creditors are threatening you with.
Establishing eligibility for chapter 7 is difficult. You will have to fill out the forms properly. The documentation itself makes filing for bankruptcy a difficult task. Therefore, don’t risk getting rejected as timing is very important in bankruptcy filing. Get help without delay.