Who Should Be Thinking About Bankruptcy?
Consumer bankruptcy can be an extremely useful tool for debtors who are struggling with a wide range of debts, from medical debt and credit card debt to mortgage debt. Yet at the same time, bankruptcy is not necessarily the right choice for everyone. Given the complexity of the bankruptcy process and the different types of bankruptcy and eligibility requirements for consumers, it is always important to discuss your case with an experienced Oak Park bankruptcy attorney who can assist you. In the meantime, who should be thinking about the possibility of filing for bankruptcy?
A recent article in Business Insider considers when debtors should be thinking about bankruptcy and when they should be thinking through other options. We can tell you more about bankruptcy and whether it might be helpful to consider its benefits given your particular financial circumstances.
You Do Not Have Obvious and Clear Options for Repaying What You Owe
Most often, bankruptcy is appropriate in situations where a debtor does not have obvious options, or a clear path forward, for repaying the debt they owe. While options can exist to work out debt settlements with creditors in certain circumstances, most individuals who will want to consider bankruptcy are those who have more debt — and higher monthly payments — than their current income allows for.
You Have Dischargeable Debt
You will only want to consider bankruptcy if your debt is dischargeable. If you do not have dischargeable debt, bankruptcy is not the right option for you. Most types of consumer debt are dischargeable, including most credit card debt, medical debt, motor vehicle debt, and mortgage debt.
You are Eligible for the Type of Bankruptcy You Want to File
Different types of bankruptcy have different requirements. You will want to determine the type of bankruptcy you want to file for and then determine your eligibility. If you are not eligible to file for a particular type of bankruptcy (typically a Chapter 7 liquidation bankruptcy or a Chapter 13 reorganization bankruptcy if you are a consumer), you may want to consider other options.
You are at Risk of Foreclosure But are Eligible for Chapter 13 Bankruptcy
Are you at risk of losing your home to foreclosure? If you are eligible for Chapter 13 bankruptcy as a regular wage earner, then bankruptcy could be a very good course of action for you. Through a Chapter 13 bankruptcy, you can halt a foreclosure proceeding, get caught up on the mortgage payments you owe, and remain in your home.
You Understand the Effects of a Bankruptcy Case
Finally, you will want to be certain that you understand the effects of a bankruptcy case before you file. Your credit will be impacted, but likely not as significantly as you might expect. You should also make sure you understand how a Chapter 7 bankruptcy will affect your non-exempt assets and your dischargeable debt (you will get a fresh start financially in about four to six months) and how a Chapter 13 bankruptcy will play a role in your life for quite some time (repayment plans usually last three to five years but this type of bankruptcy does not involve the liquidation of any assets).
Contact a Bankruptcy Attorney in Oak Park Today
Are you currently struggling with debt? Are you considering the possibility of filing for bankruptcy? Whether you have questions about debt relief more broadly or you want to find out more about getting started on a particular type of bankruptcy filing, an experienced consumer bankruptcy lawyer in Oak Park can speak with you today. Do not hesitate to get in touch with us to find out more about personal bankruptcy and how we can assist you with your case. Contact the Emerson Law Firm for additional information and to speak with an attorney.
See Related Blog Posts:
Checklist for a Chapter 7 Bankruptcy
Top Things to Consider About Student Loans and Bankruptcy
A recent article in Business Insider considers when debtors should be thinking about bankruptcy and when they should be thinking through other options. We can tell you more about bankruptcy and whether it might be helpful to consider its benefits given your particular financial circumstances.
You Do Not Have Obvious and Clear Options for Repaying What You Owe
Most often, bankruptcy is appropriate in situations where a debtor does not have obvious options, or a clear path forward, for repaying the debt they owe. While options can exist to work out debt settlements with creditors in certain circumstances, most individuals who will want to consider bankruptcy are those who have more debt — and higher monthly payments — than their current income allows for.
You Have Dischargeable Debt
You will only want to consider bankruptcy if your debt is dischargeable. If you do not have dischargeable debt, bankruptcy is not the right option for you. Most types of consumer debt are dischargeable, including most credit card debt, medical debt, motor vehicle debt, and mortgage debt.
You are Eligible for the Type of Bankruptcy You Want to File
Different types of bankruptcy have different requirements. You will want to determine the type of bankruptcy you want to file for and then determine your eligibility. If you are not eligible to file for a particular type of bankruptcy (typically a Chapter 7 liquidation bankruptcy or a Chapter 13 reorganization bankruptcy if you are a consumer), you may want to consider other options.
You are at Risk of Foreclosure But are Eligible for Chapter 13 Bankruptcy
Are you at risk of losing your home to foreclosure? If you are eligible for Chapter 13 bankruptcy as a regular wage earner, then bankruptcy could be a very good course of action for you. Through a Chapter 13 bankruptcy, you can halt a foreclosure proceeding, get caught up on the mortgage payments you owe, and remain in your home.
You Understand the Effects of a Bankruptcy Case
Finally, you will want to be certain that you understand the effects of a bankruptcy case before you file. Your credit will be impacted, but likely not as significantly as you might expect. You should also make sure you understand how a Chapter 7 bankruptcy will affect your non-exempt assets and your dischargeable debt (you will get a fresh start financially in about four to six months) and how a Chapter 13 bankruptcy will play a role in your life for quite some time (repayment plans usually last three to five years but this type of bankruptcy does not involve the liquidation of any assets).
Contact a Bankruptcy Attorney in Oak Park Today
Are you currently struggling with debt? Are you considering the possibility of filing for bankruptcy? Whether you have questions about debt relief more broadly or you want to find out more about getting started on a particular type of bankruptcy filing, an experienced consumer bankruptcy lawyer in Oak Park can speak with you today. Do not hesitate to get in touch with us to find out more about personal bankruptcy and how we can assist you with your case. Contact the Emerson Law Firm for additional information and to speak with an attorney.
See Related Blog Posts:
Checklist for a Chapter 7 Bankruptcy
Top Things to Consider About Student Loans and Bankruptcy
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