Declaring bankruptcy is a big decision, and it is important to carefully consider all the potential benefits, weighing them against the specifics of your situation. Only then can you determine exactly what type of bankruptcy is the right fit for you and how to proceed.
To help you get started, here are a few reasons why you may want to consider Chapter 13:
- Collection activities against you have to stop. Are you tired of getting phone calls from the lenders? Are you sick of the threat of asset repossession? Once your bankruptcy case begins, all of that has to stop until the case ends. It gives you a much-needed break.
- It can stop foreclosure. This is the most serious type of asset repossession most people will ever face. Just filing bankruptcy creates an automatic stay. It saves your home on a temporary basis. It gives you a chance to work out the details and perhaps put an end to the foreclosure entirely.
- It gives you more time to pay off your debt. Chapter 13, unlike Chapter 7, does not focus on asset liquidation. Instead, it gives you a repayment plan. This buys you some time -- often, three to five years -- to pay your debt. If the problem is just that you can't pay it all at once, this is an ideal solution.
- You can get current on what you owe, including your mortgage. Your bankruptcy plan will carefully help you move forward so that the end result is that you are current on your payments once again, stopping the collections activities and eliminating the need for foreclosure.
Do you have any questions about how this works? Our helpful website can give you a lot of information and answer more of your questions about a Chapter 13 bankruptcy.