In a new year, many people think about how they can improve their financial situation for the year to come.
It is common for people's resolutions to include saving money or getting out of debt. In many cases, the best way for a person to get out of his or her debt is to file for bankruptcy.
How bankruptcy helps to repay debt
If you are employed and earn a regular wage, a great way for you to get relief from your debt is to file for Chapter 13 bankruptcy. A benefit of filing for Chapter 13 bankruptcy is that you likely can keep your house in the process. You will create a plan of repayment that allows some debts to be dismissed while you pay the remainder of your debts over three to five years.
Where to start
You should start by getting an evaluation on whether your specific situation will be compatible with a Chapter 13 bankruptcy filing. You should also start to think about preparing the papers and documenting how much you owe, from compiling a list of creditors along with the amount owed to a breakdown of your expenses. Tax information will also need to be obtained.
Chapter 13 can be a preferable choice to Chapter 7 bankruptcy because it means that you will be able to keep your house; however, you may be subject to higher legal fees. Considering which to choose should be a carefully thought-out process, and you should think about whether bankruptcy is the best way for you to get a fresh start from your debts.
Source: Debt.org, "Who Should File Chapter 13 Bankruptcy?," accessed Jan. 4, 2018