If you are an individual facing the harsh realities of bankruptcy, you want to prepare yourself for the oncoming tide. Knowing the difference between the types of bankruptcy and being able to discriminate between their various attributes will make you better prepared for the process. You might be wondering if Chapter 13 bankruptcy is right.
What is Chapter 13?
Chapter 13 is a form of bankruptcy that allows an individual to restructure his or her debt. Under this court-supervised process, you are able to seek debt relief and debt consolidation in order to make your debts much easier to pay off. For individuals who are employed or receiving some form of income, this is the most reasonable form of bankruptcy to file.
Chapter 7 is a liquidation form of bankruptcy. As the most prominent form of bankruptcy, Chapter 7 absolves a person of responsibility for their debts, and also relinquishes control of a person’s assets to the bankruptcy court. The court then reallocates those assets in order to pay off creditors.
Filing Chapter 13 allows you to maintain control of your assets, and restructure your debt. However, you still have some financial responsibilities. Remember, Chapter 13 doesn’t get rid of all your debts. Also, it’s important to know that no form of bankruptcy can get rid of student loan debts, alimony, or court-ordered child support responsibilities.
As you continue your research on different forms of bankruptcy, feel free to contact our professional lawyers with any questions regarding your current situation. Also, no matter what you read or who wrote it, nothing can replace the advice of an actual attorney!