Bankruptcy: What is Best for me? Chapter 7 -vs- Chapter 13
Like you, most people consider bankruptcy to be something they would like to avoid at all costs. However, there are times when bankruptcy is really the only way to reset your finances so you can get a fresh start. Alta Legal provides West Jordan bankruptcy advice and services. If you are considering bankruptcy, we can help.
It is good to educate yourself on the different types of bankruptcy that are available so that you can better understand which is the best choice for you. Keep reading to learn more.
Chapter 7 Bankruptcy
Chapter 7 is a type of bankruptcy option also referred to as “liquidation bankruptcy.” This is one of the quickest and most efficient ways to get out of debt. The benefits of this option include:
- Quick resolution – A Chapter 7 can usually get completed within 3 to 6 months.
- No payment plan – You will not get left with a payment plan like you would in a Chapter 13 bankruptcy.
- Most debts get wiped out – You usually walk about from a Chapter 7 debt-free.
- Property protection – This is important if you are hoping to save your house in the process.
A Utah Chapter 7 bankruptcy attorney could help you with this option. This type of bankruptcy works best for people who fall into the following categories:
- Do not own much property;
- Are dealing with credit cards, medical bills, and loans;
- Income does not exceed the state median for size.
Chapter 13 Bankruptcy
A Chapter 13 bankruptcy is much different from a Chapter 7.
Chapter 13 will require a person to pay back their debts through a repayment plan. This plan is set up to be manageable but it usually requires that all disposable income each month will go to the repayment plan.
A Utah Chapter 13 bankruptcy attorney can help with this option. This type of plan is intentionally for people who fall into the following categories:
- Income exceeds the state’s limits for Chapter 7;
- Types of debts that cannot get discharged – would include income taxes, domestic support obligations, or student loans;
- Those facing foreclosure sale.