How to Know Whether to File Chapter 7 or Chapter 13 Bankruptcy
How to Know Whether to File Chapter 7 or Chapter 13 Bankruptcy
With rising food and gas prices, an inflated housing market, and a global pandemic creating mountains of medical bills, many individuals and families throughout the U.S. are struggling financially. If you’ve fallen on hard times and cannot see a way out of debt, you might be interested in learning more about filing for bankruptcy. This is a serious life decision with far-reaching implications that should not be taken lightly, and yet the complexity of the process can make it very difficult to know whether you are truly making the right move. One of the main factors you need to consider is whether your situation would be better suited to filing Chapter 7 Bankruptcy or Chapter 13 Bankruptcy.
Tips from Our Expert Bankruptcy Attorney Serving Burlington, NC
Daniel L. Hawkins, PA is a knowledgeable and experienced bankruptcy attorney serving clients throughout Burlington, NC and the surrounding areas. Having handled countless Chapter 7 and Chapter 13 bankruptcy cases over the past few decades, he can be trusted to recommend the preferred option given a client’s particular financial circumstances. For many people, Chapter 7 is a much better fit, as it can go into effect more quickly while allowing the filer to still hold onto most of their property. It offers a means of completely wiping out many areas of debt and avoids any long-term payment plans. Not all individuals will qualify for Chapter 7 bankruptcy, however.
Chapter 13 Bankruptcy is a better option for people with high incomes or substantial property equity. Chapter 13 requires the repayment of a certain portion of debts. Most of your disposable income will be given to creditors for three to five years. This requires the completion of a form to determine your amount of disposable income after taking into consideration deductions for things like food and clothing, taxes, and childcare costs.
This information only begins to scratch the surface of everything that goes into deciding between Chapter 7 and Chapter 13 bankruptcy. Due to the matter’s complexity, it is highly recommended to work with a skilled bankruptcy attorney throughout the process. For quality guidance and representation in the Burlington, NC area, contact Daniel L. Hawkins, PA.
