Top Benefits of Bankruptcy in 2023

In the New Year, you may be considering the possibility of filing for personal bankruptcy. As you may already know, the two most common types of personal bankruptcy are Chapter 7 bankruptcy cases and Chapter 13 bankruptcy cases. Both types of bankruptcy require the debtor to show eligibility, and the proof required to show a person’s eligibility for Chapter 7 will be much different from that required for a Chapter 13 case. In short, Chapter 7 requires the debtor to show that their income and assets are limited enough for liquidation bankruptcy to make sense. Differently, Chapter 13 bankruptcy requires the debtor to show that they have a regular income that is stable enough and of a high enough value for the debtor to reliably be able to make payments for three to five years in a reorganization bankruptcy. Both types of bankruptcy come with pros and cons.

When it comes to the “pros,” what are the top benefits of bankruptcy in 2023? Our Oak Park bankruptcy attorneys have more information to help you. The following are the benefits of personal bankruptcy that you should consider.

You May Be Able to Stop a Foreclosure

When you file for Chapter 13 bankruptcy, you can stop foreclosure. Under U.S. bankruptcy law, this type of bankruptcy will let you halt the foreclosure process and catch up on mortgage payments with your lender so that you can remain in your home.

You Can Obtain Debt Relief While Keeping More of Your Assets Than You Might Think

Most likely, you can obtain debt relief while keeping more of your assets than you might think when you file for bankruptcy. If you are filing for Chapter 13 bankruptcy, you will not lose any of your assets. If you are filing for Chapter 7 bankruptcy, you should know that this is a type of liquidation bankruptcy, but Illinois bankruptcy exemptions will allow you to keep a wide range of your assets, both tangible and intangible. Those assets include equity in your home and in a motor vehicle, retirement accounts, a large portion of your wages, many kinds of personal property like clothes and books, any “tools of the trade” that you require for your profession, and a “wildcard” exemption so that you can keep any asset or assets of your choosing up to $4,000 in value.

Debt Collectors Must Stop Trying to Collect

The automatic stay is one of the great benefits of filing for personal bankruptcy. If you are being routinely contacted by creditors, you should know that the automatic stay applies to your case the moment you file for bankruptcy. The automatic stay is an injunction that stops debt collectors and creditors from taking any further action against you — including contacting you — in an attempt to collect on the debt you owe. Indeed, the automatic stay stops phone calls, emails, lawsuits, garnishments, and more.

Contact an Oak Park Bankruptcy Attorney

Do you have questions about the implications of filing for consumer bankruptcy or the potential benefits of Chapter 7 or Chapter 13 bankruptcy case? Our experienced Oak Park bankruptcy attorneys can help you. Do not hesitate to get in touch with us to find out more about the services we provide to consumers in Illinois. Contact the Emerson Law Firm for more information.



See Related Blog Posts:

Holiday Spending and New Year Bankruptcy: What to Consider

Supreme Court Will Consider Bankruptcy Debtor’s Liability for Someone Else’s Fraud

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