What Is Chapter 7? What Is Chapter 13?

If you are struggling with mounting and unpayable debts in the Chicago area, discuss your circumstances and your options with an experienced Chicago bankruptcy lawyer. If you conclude that bankruptcy is the best option in your situation, then you’ll need to determine whether a Chapter 7 bankruptcy or a Chapter 13 bankruptcy is best. Here’s a brief summary of what the two options offer. About two out of every three bankruptcy filers opt for Chapter 7 bankruptcy. A Chapter 7 bankruptcy provides:

– Immediate protection from creditors: Upon filing Chapter 7 bankruptcy, the automatic stay stops all creditors from suing you or even contacting you.

– A new beginning: With just several exceptions, all of your debts are discharged (wiped out) in a Chapter 7 bankruptcy.

– Speed: You’ll be finished with a Chapter 7 bankruptcy in about 90 days.

– Cost: Usually, a Chapter 7 bankruptcy will cost less than a Chapter 13 bankruptcy.

A Chapter 7 bankruptcy does not in most cases discharge student loan debt, child support, taxes, or fines owed to a court. A Chapter 13 bankruptcy:

– Stops foreclosure: A Chapter 13 bankruptcy lets you catch up on past-due mortgage payments and begin making current payments.

– Protects assets: A Chapter 13 bankruptcy lets you keep some of the assets that you would give up in a Chapter 7 bankruptcy.

– Can modify payment amounts and schedules for your home and vehicle.

– Restructures child support and divorce debts: You can repay back child support and other divorce obligations over a five-year period.

If you do not qualify for a Chapter 7 bankruptcy, a Chapter 13 bankruptcy may be your best remaining alternative. A Chapter 13 bankruptcy requires you to pay back some of your debts over 3 to 5 years. If you are struggling with debt, bankruptcy may or may not the best option. If you’re deeply in debt in the Chicago area, discuss your finances and options with an experienced Chicago bankruptcy lawyer, and make the call as quickly as possible.