How Debt Solutions Work:

Bankruptcy

Bankruptcy Chapter 13

A Chapter 13 Bankruptcy is a court mandated debt repayment program. In order to qualify, you may be required to undergo a background check, receive credit education within the first six months of your filing, submit and get approved for a repayment plan, and meet with creditors to ensure satisfactory participation. If you are approved for this type of bankruptcy, your financials are evaluated every few months and your payments may be adjusted. There are many hidden fees and costs associated with bankruptcy, which makes the overall cost of a chapter 13 unpredictable. In many cases you can get out of debt faster and for less money through a debt settlement program, while avoiding the public court bankruptcy record.

Bankruptcy Chapter 7

A Chapter 7 Bankruptcy is also known as a "Liquidation". This means that most or all of your assets are liquidated to pay debts, and the remaining debts owed are legally wiped out through the Federal Bankruptcy Court. All collection efforts are legally halted.

Since the bankruptcy reform, it has become very difficult to qualify for a ch. 7 bankruptcy. Doing so requires the passing of a "means test". Essentially, your financials are evaluated and it is determined if you have the ability to make payments on a chapter 13 bankruptcy. If you cannot make a qualifying payment, then you may qualify for a chapter 7.

With either type of bankruptcy, you will be left with a permanent and public court record, as well as a public record item reporting on your credit reports for up to 10 years. Filing bankruptcy can preclude you from many things, such as certain insurance products, employment, and qualifying for credit to name a few.

If you would like a free consultation and debt analysis with a professional debt advisor to go over your options and help you find the best solution, simply complete the quick form on the right side of this page.