Those who are crippled by financial debts may feel like there is no way out. These debts can place such a heavy burden on every part of their life, causing them to feel constantly stressed and fearful about the future.
Being relieved of all debt can feel like an impossible dream for many. But it can be possible through bankruptcy. While bankruptcy does have some disadvantages – a poor credit score being the most notable of them – it can serve as a lifeline to those who would otherwise be unable to tackle their debts.
How Chapter 7 bankruptcy works
Chapter 7 bankruptcy is available to those who have a very low income or no income at all. It’s especially suited to those who have overwhelming debt but not many assets because it requires that debtors liquidate all their assets other than their basic possessions. After all these assets are liquidated, the debtor will likely be subject to a debt discharge, meaning that all their debts will be wiped, leaving them debt-free and able to create a new, more positive life for themselves.
How Chapter 13 bankruptcy works
Chapter 13 bankruptcy is best suited for those who have a stable income and overwhelming debts. It gives debtors the opportunity to restructure their debts so that they can pay them steadily over time. Upon completion, the debtor will also benefit from a debt discharge.
If you want to break free from your debts, but you’re not sure of the best option for your circumstances, an experienced attorney can help you learn more about the different bankruptcy chapters so that you can move forward toward a debt-free life.