Is Chapter 7 or Chapter 13 Bankruptcy a Better Choice for Me, Personally?

 Posted on April 20, 2023 in Bankruptcy

When debt has become an unmanageable burden, it is important to be proactive in seeking a solution. All too often, individuals think that if they work harder or spend a little less that unmanageable debt will suddenly become manageable. Unfortunately, due to influences like interest and unexpected life events, it is rare that simply “digging a little deeper” solves debt that has spiraled out of control. This is one of the primary reasons why the U.S. Bankruptcy Code exists. The opportunity to file for bankruptcy serves as an acknowledgment that overwhelming debt can be resolved with a little help along the way.

If you are thinking about filing for personal bankruptcy, you have two primary options to choose from. Chapter 7 bankruptcy is available to low-income filers. Chapter 13 bankruptcy is better suited for those who can make manageable monthly debt payments on their outstanding balances. Which option is right for you? That is an excellent question.

Picking and Choosing

If you qualify for Chapter 7 bankruptcy relief, this may be your best option because you can obtain a discharge of your eligible unsecured debts without first having to pay your creditors anything.

However, there are two reasons why considering Chapter 13 bankruptcy might be worth your time, even if you are eligible for Chapter 7 relief. First, if you are trying to save your house from foreclosure, the benefits of the automatic stay likely will not be in place long enough for you to accomplish that goal via Chapter 7 bankruptcy. Additionally, if you own a lot of non-exempt assets that are significant in value, filing for Chapter 7 may lead to the sale of those assets, which may not be ideal.

If you are not eligible for Chapter 7 relief and you can make payments on your debt, Chapter 13 bankruptcy might be a great option for your circumstances.

Contact a Kane County Bankruptcy Lawyer Today for Personalized Insight and Guidance

While the information detailed above serves as an introduction to why someone might benefit from filing for one type of bankruptcy over another, nothing compares to seeking personalized guidance from an experienced Kane County, IL bankruptcy lawyer at the Thomas Law Office.

Attorney Colleen Thomas is experienced in a range of bankruptcy-related matters. She can help you evaluate your options and determine your best course of action. 

Start exploring various debt relief opportunities today by scheduling an initial consultation. You can connect with our legal team by submitting a contact form on our website or by calling us at 847-426-7990. We look forward to assisting you.

Source:

https://www.uscourts.gov/services-forms/bankruptcy/bankruptcy-basics