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Here are the benefits of filing for chapter 7 bankruptcy to chapter 13

In most bankruptcy cases, Chapter 7 makes a better fit than chapter 13. For example, Chapter 7 bankruptcy is faster, the most filer can keep most or all of their properties, and they don’t even have to repay their creditors through a 3-to-5 year repayment plan like Chapter 13. However, not everybody can qualify to file for the Chapter 7 bankruptcy, and in certain cases, it does not even provide assistance for the filers. Learn when Chapter 7 bankruptcy may be more beneficial than Chapter 13 bankruptcy.

Benefits of Chapter 7 bankruptcy

Chapter 7 bankruptcy is the most effective and efficient way of getting out of debt fast, and most potential filers prefer filing this chapter if they easily qualify. Here’s how it works –

It is comparatively faster: A typical Chapter 7 case consumes 3-6 months to complete.

There’s no lengthy repayment plan – Unlike Chapter 13, filers do not have to repay into a 3-5-year repayment plan.

Most, but not all your financial liabilities get wiped out in Chapter 7 bankruptcy – The individual filing can rise up debt-free except for specific debts, such as recent taxes, unpaid child support, and student loans. To learn more about non-dischargeable debts in Chapter 7 and Chapter 13, refer to Recovery Law Group.

You can be able to hold onto your house or personal vehicle in certain circumstances. You can also be able to hold on to your car or house providing you are current on your payments and continue making payments post the bankruptcy case, and also exempt the equity amount that you have in the property.

Who can file for Chapter 7 Bankruptcy?

Chapter 7 functions well for most people, especially those who:

Own little property

Have medical bills, personal loans, and credit card balances

Whose family income never exceeds the state median for the similar family size

You will take the Means Test to check if your income meets the requirements for this chapter. If your income stays below the average family income in your state, you will easily qualify for chapter 7 bankruptcy.

If your income shows higher than the median, you will have another scope to qualify. However, if after deducting permissible expenses, including payments for tax debts, child support, secured debts (such as car loan, or mortgage), you have income left over to make a substantial payment to your lenders (known as disposable income), you will not pass for Chapter 7 bankruptcy filing.

To learn more about the benefits of Chapter 7 bankruptcy or how to file for the same, refer to our Chapter 7 bankruptcy attorneys at Recovery Law Group at 888-297-6203.

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Location: Culver City, CA, USA

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