Kern County CA Bankruptcy Attorneys
When it comes to filing for bankruptcy, you have many choices to make. Many people who are unfamiliar with the process think of bankruptcy as being a one size fits all process. Unfortunately, this is not true. You can do much reading and research, but the truth is that you will need legal counseling if you are considering filing for bankruptcy. This is the only way to assure that you are making the best decision for your financial future. One of the main questions most individuals who are considering filing is what is the difference between filing for Chapter 7 and Chapter 13 bankruptcy. There are some basic differences, though to decide which is best for you, you and your lawyer should take it on a case-by-case basis.
Difference in Chapter 7 & 13 Bankrupcty
Chapter 7 is what is referred to as a liquidation process. This means that your property will be divided into exempt and non-exempt property. Most property, such as household goods, clothes, and even most vehicles, are considered exempt, which means that you are not in danger of losing them. Non-exempt property is given to a trustee who will then use it to reimburse creditors. Most debts are erased after the Chapter 7 process. Chapter 13, on the other hand, is a repayment plan and is similar to loan consolidation. Repayment normally lasts 3-5 years and monthly payments are made to the trustee, who distributes the money to the creditors. Debt reduction is often included in the Chapter 13 process.
Experienced and Professional Bankruptcy Attorneys
Although there are many common reasons for wanting to declare bankruptcy, here are a few examples. Imagine that you are having trouble paying for a mortgage or car loan. In this case, a Chapter 7 bankruptcy will require you to give the creditor that property in question or pay back amount owed in full during the process. In Chapter 13, you can set up a payment plan to pay back the creditor. Another common example is an individual who has student loans or criminal fines that are outstanding. In this care, Chapter 13 is the only option since the debt cannot be erased by Chapter 7.
Contact Us Today
There are many situations in which one may find the bankruptcy is the best option. Because there are so many loopholes and complicated proceedings, it is essential that you consult with Bakerfield bankruptcy lawyers whom you can trust. Contact us at 661-952-9740 for a free consultation and find out the options available to your regarding the various types of bankruptcy.