Bankruptcy SolutionsChapter 7 "Fresh Start" or Chapter 13 Repayment Plan
Why Consider Bankruptcy?
If you are facing substantial debt, you should seriously consider bankruptcy as an option. In many cases, bankruptcy can completely erase the majority of your debt with very little time or expense, while allowing you to keep your house, car, and personal belongings. It really can be a miraculous solution for many people. We routinely have clients with $10,000.00, $30,000.00 or even $100,000.00 or more in debt that completely gets wiped out. Even if you do have to pay back some of your debts, a chapter 13 bankruptcy is usually a much better option than a debt consolidation loan.
What is Bankruptcy?
The U.S. Bankruptcy Code is a set of federal laws that were designed with you in mind, the honest but unfortunate debtor, to give you a fresh start in your financial life. There are two types of bankruptcy available to individuals, a chapter 7 bankruptcy and a chapter 13 bankruptcy. A chapter 7 bankruptcy, also known as a liquidation bankruptcy or a “fresh start” bankruptcy, essentially wipes out all your unsecured debt (credit cards, medical bills, personal loans, etc.) in one fell swoop. A chapter 13 bankruptcy, also known as a reorganization bankruptcy, is kind of like a debt consolidation, only better, where you pay off a portion of your debt over 3-5 years and then receive a discharge on any remaining debt at the end.
Chapter 7 Bankruptcy
If your income and assets are low enough, you can qualify for a chapter 7 bankruptcy and have all of your debts discharged (forgiven) in one fell swoop. You won’t pay a dime, except for certain debts like recent taxes, child support, and student loans which are non-dischargable. Chapter 7 cases are usually completed in 3-4 months. The only downside to a chapter 7 is that if you are behind on your house or car payment, we cannot force the lender to let you keep the house or car. In that case, a chapter 13 may be the better option for you.
Chapter 13 Bankruptcy
There are several situations where a chapter 13 might be a better option for you. If you are in danger of losing your home to foreclosure, or your car to repossession, a chapter 13 bankruptcy can save your home and car. Also, if you have a significant disposable income (income remaining after necessary living expenses are paid), or substantial assets, you may not qualify for a chapter 7. A Chapter 13 bankruptcy is kind of like debt consolidation, but much more powerful. We can eliminate or reduce the interest rate on all your debts and get it all paid off in 5 years with one easy monthly payment. If there is any debt left over unpaid after 5 years, it gets discharged, meaning you never pay it. You will get to keep your house and car, and we can even sometimes reduce the amount you owe on your car through what’s called a “cramdown.”
What’s Your Story?
At Honsalek Law, we focus on your individual situation, making sure that the best option is selected for you. We offer free in-depth consultations so that we can get to know you and your family well enough to help you decide which options may work for you. This part of the process is extremely important, so make sure you spend some time with us getting to know your options. We will never try to pressure you into anything.
Sometimes bankruptcy is not the best option, and we always counsel our clients not to file bankruptcy if it’s not in their best interest. But you should always know your options. Schedule your free consultation now.
Don’t hesitate to call us with any questions you have; we are always available to answer questions.
Get Some Breathing Room
Filing for bankruptcy gives you some breathing room to get a handle on your finances and halt the harassing phone calls and letters and reduce stress for you at work and at home. Bankruptcy is one of the most powerful legal tools available to you. As soon as we file your case you are protected by the Automatic Stay, a legal shield that protects you from all creditor activity. And if they try to break it, we can enforce it with bankruptcy court sanctions.
Despite what you may have heard, individuals and families that file for bankruptcy can almost always keep their homes and cars as long as they can keep up with the payments. In fact, even if your car has already been repossessed, we can usually still get it back as long as too much time hasn’t passed.
Bankruptcy also typically HELPS your credit score increase. For most people, when they are ready to file bankruptcy, their credit score is already at a low point. Our clients typically see their credit score increase by more than 100 points within the first year after their bankruptcy discharge.
You Deserve Freedom
It’s time for you to have this burden lifted from your shoulders. Your circumstances don’t make you who you are, and you shouldn’t have to continue living under insurmountable debt. Bankruptcy may just be your best option, and we are ready to help you through to the end of this hardship. Give us a call today – we’re ready to help.
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