When a person begins to consider bankruptcy, they often spend most their time and energy on Chapter 7. They are familiar with the benefits, including the ability to have some or all of their debt discharged.
But did you know there are quite a few benefits associated with Chapter 13? In fact, there are so many that you may begin to realize this is the better option.
Here are several reasons to choose Chapter 13 over Chapter 7:
- No concerns about losing your property. Even though most people who file Chapter 7 are in position to keep the majority of their assets, there may be some type of non-exempt property that is not protected.
With Chapter 13, you don’t have to concern yourself with this. As long as you continue to make payments through your repayment plan, your property is safe.
- Better chance of stopping foreclosure and keeping your home. Both Chapter 7 and Chapter 13 will temporarily stop a foreclosure. However, Chapter 7 allows you to make up missed payments as part of your payment plan. This ensures that you can stay in your home.
- The payment plan can help you better organize your finances. Nobody wants to pay back creditors through a Chapter 13 repayment plan, but in the long run this will improve your outlook. It gives you the opportunity to better understand your finances, while learning what it takes to stay on track. Best yet, some plans only last three years, which is not long when you consider the overall picture.
Do you have questions about Chapter 7 and Chapter 13 bankruptcy, including how they differ? Answer these before you make any decision on moving forward. We can help you better understand the pros and cons of bankruptcy, including why you may want to opt for Chapter 13.