Here is a big question many people are faced with: should I file a Chapter 7 or Chapter 13 bankruptcy? While the answer may come easy enough to some, there are those who don’t know the difference between the two.
Note: not everybody will qualify for Chapter 7 bankruptcy. If you find yourself in this position, just the same as many others, you may want to turn to Chapter 13 as a means of getting your finances back in order.
Reasons to File Chapter 7 Bankruptcy in Philadelphia
When attempting to answer the question of whether or not you should file a Chapter 7 bankruptcy, there are many details to consider. Here are five of the primary reasons to look into this option:
1. Shorter process. Did you know that the life of a Chapter 7 bankruptcy is much shorter than Chapter 13? Those who are in a hurry to put this behind them will find this to be the better of the two choices. Within six months this process could be in the rearview manner.
2. Say goodbye to most of your unsecured debt. Many people agree that this is the number one benefit of Chapter 7 bankruptcy. Most of your unsecured debt can be discharged, with the exception of tax debt and student loans.
3. Less expensive in terms of legal fees. Since Chapter 7 bankruptcy typically concludes more quickly than Chapter 13, you can expect your legal fees to be less. For those in a difficult financial position, this is good news.
4. No need to make a monthly payment. With Chapter 13 bankruptcy, you will make a monthly payment to a trustee who has the responsibility of sending this money to the appropriate creditors. Subsequently, your disposable income takes a big hit. With Chapter 7 bankruptcy, there is no payment plan.
5. Recover quickly. Contrary to popular belief, just because you file Chapter 7 bankruptcy it does not mean your financial life is over. Soon enough, your credit score will begin to creep back up. The Chapter 13 recovery process is prolonged, thanks to the fact that it will remain active for as long as five years.
With so many benefits of Chapter 7 bankruptcy, when compared to Chapter 13, there is one real question you need to answer: do you qualify? Speak with an attorney about your situation, including whether or not Chapter 7 bankruptcy in Philadelphia is the right answer.