The Key Advantages Of Using Chapter 13 Bankruptcy

As you begin looking into options for handling and eliminating your debt load, you might start considering bankruptcy. With bankruptcy, you can find a lot of relief from your debts; however, it is always important to choose the right branch for the situation you are in. Many people feel that the best option is Chapter 7, but you should know that there are many advantages to choosing Chapter 13 instead. Here are some of the key advantages.

It provides you with instant relief

Both branches of bankruptcy give you instant relief from debt collectors, but this instant relief lasts a lot longer in a Chapter 13 case. The instant relief you receive comes from the automatic stay the bankruptcy trustee orders when he or she receives your case file. This court-ordered event makes your creditors stop efforts for all collections, and it will last until you make the last payment of your Chapter 13 case. In a Chapter 7 case, you will receive it only as long as it takes to get a discharge of your case, which is typically less than one year.  

It offers relief for debts that Chapter 7 cannot help with

Secondly, Chapter 7 is ideal if you only owe debts that qualify for a discharge; however, it is not very helpful for other types of debts. Chapter 13 is actually helpful for all debts you owe, including those that would not qualify for a discharge in Chapter 7. A good example of this is alimony or child support. If you are really behind on either of these, Chapter 7 will offer no way for you to catch up, whereas Chapter 13 would allow you to include the debt in your repayment plan and would offer you five years to catch up on it. There are a lot of debts that do not qualify for a discharge in Chapter 7, but you can include all of them in your Chapter 13 repayment plan.

It offers relief from major events

The other important thing to know is that Chapter 13 can also help with major events in life, including foreclosure, repossession, and an underwater loan. If you are facing any of these events, using Chapter 13 could put a stop to them and provide the relief you need.

These are some of the ways Chapter 13 can help you more than what Chapter 7 could offer. If you are not sure which branch would be best for the debts you have, visit a lawyer for a free bankruptcy consultation appointment.

For more information, contact a Chapter 13 bankruptcy attorney.


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