“It’s all over,” You think to yourself. “I’ll have nothing left.”
If you’re drowning in debt and starting to contemplate bankruptcy as a possible solution to your situation, this article will provide you with some information on bankruptcy. We specifically focus on a Chapter 7 bankruptcy.
What is bankruptcy
Bankruptcy is when an individual starts to liquidate their assets in order to pay off their debts. Sometimes, some individuals will create a payment plan as part of their bankruptcy. Bankruptcy can be filed as a couple, individually or by a business/organization. In accordance with the United States Courts, all cases of bankruptcy are managed by federal courts.
If you’re an individual or couple, then you’re most likely to file a Chapter 13 or Chapter 7 bankruptcy. Chapter 7 bankruptcy tends to be more popular amongst those who file for bankruptcy than Chapter 13. We’ll talk more about why this is the case in the upcoming section.
The Difference Between Chapter 7 and Chapter 13 Bankruptcy
As Napoleon Hill writes in his book Think and Grow Rich, “Neglecting to broaden their view has kept some people doing one thing all their lives.” If you’re in a cycle of debt and are drowning in it, understanding the different options that you have is important. That is, on your journey to financial freedom and health, you’ll need to broaden your views.
So, to help you understand your options when it comes to bankruptcy, here’s a comparison between a Chapter 7 and a Chapter 13 bankruptcy.
As was mentioned previously, if you’re an individual or couple, then you’ll most likely file a Chapter 7 or Chapter 13 bankruptcy. If you’re a business (and not a sole proprietorship), then you’ll file a Chapter 7 as well. If you’re a sole proprietor, then you’ll file a Chapter 13.
A Chapter 7 bankruptcy typically involves the liquidation of assets, whereas a Chapter 13 usually involves a payment plan. For both types of bankruptcies, there are eligibility restrictions dependent on income and other factors.
A Chapter 7 bankruptcy tends to be a quicker process than a Chapter 13 since a Chapter 13 bankruptcy involves recurring payments and many other issues.
2 Things To Know About Chapter 7 Bankruptcy
Now that you know some of the basic differences between a Chapter 7 vs. a Chapter 13 Bankruptcy, here are some things that you need to know about a Chapter 7 bankruptcy. These different factors will help you understand if this type of bankruptcy is right for you.
Please keep in mind that while this article intends to clarify some of the factors associated with a Chapter 7 bankruptcy, it should not be used as a replacement for professional help. With the help of Rocky Mountain Law Office’s attorney Scott G. Wilding, you can get the help that you need.
That being said, here are some key aspects of Chapter 7 bankruptcy that you should know.
1. Chapter 7 Bankruptcy May Help You With Getting A Fresh Start
If you’re drawing in debt and aren’t sure of what to do, a Chapter 2 bankruptcy will help you have a fresh start. This means that a lot of your debt will be covered. You’ll also have some relief in your situation
Rocky Mountain Law Office will help advise you on if this fresh start will be helpful to your situation or if there’s an alternative solution to your debt issues. We recognize that every case is different. We also know that each case will require a solution that’s unique and customized to it.
2. Liquidating assets doesn’t always mean that you’ll lose all your assets
A common assumption that people have regarding a Chapter 7 bankruptcy is that it involves losing all your assets. The truth is though that you may still be able to keep; some of your assets under bankruptcy laws. For example, depending on your circumstances, you may be able to keep your home, personal property, and car.
So, before you imagine living on the streets or in a car, you should remember that there are different laws that may apply to you and which may help your situation. At Rocky Mountain Law Office, we are aware of the nuisances of bankruptcy and will help you get into the best situation possible.
Is a Chapter 7 Bankruptcy Right For You?
If you’re not sure of whether a Chapter 7 bankruptcy is right for you, give us a call at 801-866-4070. We offer a free and confidential initial consultation to help you with your situation.
We would love to help you and your loved ones during this difficult process. If you’re a business, we would also like to advise you on your options. Contact us today for more information!