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Bankruptcy is a process...Not the end.

Chapter 7 vs Chapter 13 Bankruptcy

For those uncertain as to the right choices to make regarding their debt situation and what options they have to handle them, the Law Office of Gail Balser, experienced bankruptcy attorney, can advise you as to your legal rights. State and Federal laws allow a person overwhelmed by debt and without the resources to repay it to file for bankruptcy protection. With our knowledgeable advice, our office can review your financial scene and recommend an appropriate solution.

Attleboro Debt Discharge Attorney

The two most common bankruptcy filings for individuals are Chapter 7 and Chapter 13. Which one is right for you? It depends upon your personal circumstances. Below is a brief discussion as to the differences between the two. Along with an in-depth consultation with Attorney Balser, our legal staff will help you make a decision as to your best option.

About Chapter 7

A Chapter 7 bankruptcy filing basically discharges all of your debts – except those exempted from bankruptcy – by liquidating your assets and using them to pay off existing creditors. In order to be able to file for a Chapter 7 you must pass a “mean test”, which is a guideline on who can qualify for this type of filing. If you truly do not have the means to repay your obligations and qualify, the filing will list all of your liabilities and assets for the Court. The Court will review all of the information and contact your creditors regarding the pending bankruptcy. Any assets that can be sold to apply towards your debts will be handled by a Trustee of the Court. You are allowed to keep certain assets, such as your vehicle and certain amounts of money in bank or savings accounts, in addition to some other items. The process takes several months and when finalized you are debt free, with the exception of certain taxes, child or spousal support and others specific exemptions.

The main difference between Chapter 7 and Chapter 13 is your ability to repay your debts and the assets you are allowed to keep. If you do not qualify for a Chapter 7 due to failing the “means test”, then a Chapter 13 can possibly work for you. For complete information on a Chapter 7 bankruptcy filing, contact our experienced and caring legal team for a free consultation.

About Chapter 13 Bankruptcy

After changes in Bankruptcy law in 2005, less people were able to qualify for a Chapter 7 due to restrictions on income levels. More commonly used now is the Chapter 13 filing. If you have a steady source of income, such as a job or own a small business, you are likely eligible for this filing, depending on your financial picture. If you find your income is insufficient to be able to repay your obligations each month, and you are falling further and further behind, this may be the type of bankruptcy for you. Rather than face lawsuits and wage garnishment, this filing can help restructure your debt. Your assets and liabilities will be reviewed by the bankruptcy Court and a plan will be put together for restructuring your debt with the help of your attorney. Based on your ability to repay your debt, each debt will either be discharged, negotiated to a lower amount or interest rate, or scheduled for repayment at a set monthly amount. The repayment of the debt must occur within a period of 3 to 5 years. The main difference between Chapter 13 and Chapter 7 is that not all of your debt is discharged. A large portion of it – depending on your finances – is restructured for payment. This filing also allows you to keep most of your assets. Even your home may be able to be saved from a foreclosure through loan modification.

Contact the Law Office of Gail Balser

There are many complexities to both of these types of filings and it is best to schedule a free consultation with our skilled bankruptcy lawyer to fully discuss your financial circumstances. Our office cares about you and wants to work out a solution that will help you through this difficult time and put you on the path to financial stability.

To find out what type of bankruptcy filing is right for you, contact the Law Office of Gail Balser for dedicated and knowledgeable legal assistance.