FAQ: Chapter 7 And Chapter 13

Which One Is Right For Me?

If your financial situation is spiraling out of your control and you are unsure of what to do, you may be able to solve your problems by filing for bankruptcy. As the countries financial woes continue unabated, more and more Americans are turning to what was once considered an extreme or embarrassing solution to debt, and are finding that the process is not as grueling as it appears. With the help of a dedicated Chicago bankruptcy lawyer to guide you through the process, you can relieve your debt and start your life anew.

There are two primary sorts of private bankruptcy claims that most people will want to use. These are known as Chapter 7 and Chapter 13. To fully understand the nuances between these claims, you should discuss the matter with a trained legal representative. Here follows a short summary to help you familiarize yourself with the basics.

Chapter 7

The most common kind of bankruptcy in America, Chapter 7 is also referred to as ‘liquidation’. Under this filing, your unprotected assets are turned over to a trustee of the court, who will determine exactly how many of your possessions shall be liquidated, or sold off, in order to pay your creditors. Once this process is complete, your debt is considered legally discharged and you are free to move on with your life.

This kind of filing generally benefits people with few assets to lose and little hope of ever being able to pay the debt off through other means.

Chapter 13

Often called ‘debt reorganization’, under a Chapter 13 claim, you will create a plan with the court to pay off your debt over 3-5 years via a series of monthly debt payments, that the court will determine based on your income and perceived security. Though the process will almost certainly take longer than Chapter 7, it has the benefit of protecting your assets from liquidation and allowing you to continue your life with as little fuss as possible.

This is generally the choice of people with a solid source of income and significant unprotected assets they wish to save from seizure by the court.

A Bankruptcy Attorney For You

If you have any questions about the bankruptcy procedure, or wish to began the process of filing for Chapter 7 or Chapter 13, it is imperative that you contact the Law Office of Joseph P. Doyle. With the skill and training to help you get a fresh start, our firm is dedicating to protecting all of our clients.

Contact a Chicago bankruptcy lawyer for a free evaluation today!