Chapter 7 vs. Chapter 13
Which one is right for you?
If you have more bills than you can pay or if you have fallen behind due to unforeseen circumstances such as medical bills or a change in your income you may want to considerbankruptcy as a legal means to get relief from overwhelming debt. The two most common types of bankruptcy protection are Chapter 7, often called the “liquidation” bankruptcy andChapter 13, or the “wage earner’s plan.” They differ in how your debts are resolved and how long the process takes. To find out more about each of their advantages and disadvantages you should speak to our legal team of attorneys at Cain & Associates, PLLC.
Chapter 7 is the most common form of bankruptcy used by those who have high debts and few assets. Under Chapter 7 the court sells your non-exempt assets to pay your creditors and then discharges (eliminates) all the remaining unsecured debts. Most people are able to keep their personal possessions, work equipment and even vehicles under Chapter 7. The process can be completed in just a few months. If you have a regular income and assets you wish to protect Chapter 13 provides an extended amount of time (usually 3 to 5 years) to pay off your debts. As long as you satisfy the court’s payment plan any remaining debts you may have can be forgiven.
Attaining the Best Outcome for Every Client
For those people who have high debt, few assets and little or no regular income Chapter 7 is their only choice. When you visit our offices we can answer your questions and help you fill out the necessary financial information forms that establish what type of bankruptcy you may qualify for. The factors that are used to choose whether Chapter 7 or 13 are best for you include your current monthly income, the type and number of assets you may wish to protect from liquidation (such as your home, personal possessions and securities) and the total amount of debt you owe. We work closely with you throughout the process to ensure your questions are answered and your needs satisfied. For help determining the best method of using bankruptcy to resolve your financial difficulties contact our Nashville office today.