A Chapter 13 Bankruptcy Filing Will Not Make You Debt Free Immediately But Can Protect Your Home

April 27th, 2010 by admin

When facing a financial collapse, the last thing it individuals will want to do is file Chapter 13 bankruptcy. Usually people try to get in to a Chapter 7 bankruptcy before a 13 because you’ll end up debt free, wiping out all your unsecured debts. Chapter 13 is generally the last thing anyone wants to do to try and protect their financial investments, credit and future financial stability. In some circumstances, there are times when choosing to use a Chapter 13 bankruptcy filing may be the right move in order to stop the downward spiral effect and the constant harassment from creditors. One of the main reasons a person would want to file Chapter 13 is to protect property that you have a lot of equity in. In a Chapter 7 bankruptcy if there is a plot of equity in your home and you don’t have enough of an exemption to protect it, the trustee might ask for the sale of the home. For whatever reason a person finds themselves in terrible financial situations, the pressure from large amounts of debts can be paralyzing to an individual. As long as you can stay employed, Chapter 13 bankruptcy can help you regain financial security, restore your credit and give you some breathing road removing obstacles that will get you back on track in the future. Filing a Chapter 13 Bankruptcy is usually not the top choice of the people because of the 3 to 5 year payment plan that court will require you to complete. Many times, people of this situation can’t keep up with the payments because of other things in our lives going on and are set up for failure and have a Chapter 13 dismissed.

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