Making the choice to file for bankruptcy is not an easy one to make. If you find yourself in a position where this is necessary, you are probably dealing with past-due balances and debt you can no longer manage on your own. Bankruptcy offers overwhelmed consumers the ability to deal with certain types of balances once and for all.
There are two main types of consumer bankruptcy: Chapter 7 and Chapter 13. The right option for you depends on the details of your individual financial situation and the types of debt you have. There are eligibility requirements for both. It may be helpful to learn more about the two options available to you and how you can know which one will help you reach a better and stronger financial future.
Chapter 7 bankruptcy
This option is beneficial for people who are not able to make payments according to a debt-repayment plan. Many applicants prefer Chapter 7 because it allows individuals to complete the process in a matter of a few months. It is particularly beneficial for people who have a significant amount of unsecured debt, such as medical bills and credit card bills. Chapter 7 discharges many of these types of balances.
It is liquidation bankruptcy, which means you may have to sell some of your personal assets in order to pay off some of your debt. However, this does not mean that you will lose all of the stuff that is important to you. There are exemptions available that could allow you to keep a lot of your belongings and things that are reasonably necessary for everyday life.
Chapter 13 bankruptcy
Chapter 13 bankruptcy is ideal for individuals who are not eligible for Chapter 7. This process takes longer to complete, and during the process, you will make payments based on a court-approved repayment plan. This process is ideal for individuals who are facing foreclosure or who are concerned with keeping their unsecured personal property.
The right path for you
Bankruptcy can offer you a way out of a financial situation that may seem impossible right now. If you are unsure of whether this is the best choice for you or which chapter offers you the best chance for a strong financial future, it may be useful for you to reach out to an experienced Virginia bankruptcy attorney for an evaluation of your case.