The first step in getting a fresh start from your financial struggles is by choosing the right bankruptcy chapter to file with, and taking action by committing to bankruptcy. But how do you know what chapter to file with if you don't know how the reality of life will look?
You will be dealing with the consequences of filing for bankruptcy for several years, so it is important that you have a realistic picture of how it will be before you file.
How life will be with Chapter 13
The truth is that there is no quick-fix for financial struggles. If you file for bankruptcy under Chapter 13, you will be dealing with the case for at least three years; however, this might be extended to five. Therefore, you need to stick with your commitment to bankruptcy in the long term.
The benefit of Chapter 13 is that the repayment plans are quite flexible. It acknowledges that many things in your life can change in three years: That could mean new children or new jobs. Therefore, you will be able to change the terms of your repayment plan when it suits you.
However, it's not easy. In order to make the repayments required by Chapter 13, you will need to be living on a tight budget and have a complete commitment to your goals.
Any bankruptcy filing will not be easy, but it is important to remember that around 10 percent of American citizens go through bankruptcy at some point. If you think that filing for bankruptcy will offer you a fresh financial start, you should consider all options before taking action.
Source: The Balance, "Living With a Chapter 13 Case, Part 1," accessed Nov. 17, 2017