The more you review your finances, the more you realize that there is no way of escaping your debt. You’ve tried everything, just to realize that you’re in too deep to dig your way out of trouble.
In this case, Chapter 7 bankruptcy is a financial strategy to strongly consider. There are many reasons to go down this path, including the following:
- A fresh start: For most, this is what Chapter 7 bankruptcy is all about. Once your bankruptcy is in the past, you’re free from some or all of the debt that was previously holding you down. This gives you the opportunity to build the financial life you want.
- You keep your future income: Perhaps the biggest benefit of Chapter 7 bankruptcy, as compared to Chapter 13, is your ability to keep future income. There is no repayment plan with Chapter 7 bankruptcy, so you can use your future income in whatever way you best see fit.
- You can have an unlimited amount of debt: There is no debt limit associated with Chapter 7 bankruptcy, which is another big difference when compared to Chapter 13 bankruptcy. This holds true of both secured and unsecured debts.
- It’s fast: You file for Chapter 7 bankruptcy because you want to take action now, not later. And that’s exactly what you get, thanks to a discharge of debt that typically occurs within 60 to 90 days of filing with the court. The entire process will come to a close within five to six months, at which point you have the fresh start you have been dreaming of.
As you learn more about the benefits of Chapter 7 bankruptcy, don’t overlook some of the disadvantages that you have to plan for in advance.
For example, a Chapter 7 bankruptcy filing will remain on your credit report for 10 years. Also, it doesn’t discharge all types of debt, such as student loans.
If you’re interested in Chapter 7 bankruptcy, you owe it to yourself to learn more about the pros, cons and the process as a whole. Once you collect this information, you’ll then understand the steps you can take to start the process.