Getting Out of Debt Doesn't Have to Be Difficult
Many people struggle with overwhelming debt not realizing that bankruptcy can potentially solve their debt problems. Bankruptcy often provides an excellent solution for individuals who can't pay their debt!
Bankruptcy Offers a Way out of Debt
Chapter 7 Bankruptcy offers relief to debtors having financial hardship. If the debtor's income falls below the applicable median income level, the debtor is then eligible to file for a straight Chapter 7 discharge. If the debtor's income exceeds this limit, it's still possible to file if certain requirements are met under the "means test."
The protections of Chapter 7 bankruptcy prevent creditors from trying to collect on the debt during the bankruptcy case. If the bankruptcy court approves the discharge, the creditors are then permanently stopped from collecting the debt.
Chapter 13 Bankruptcy provides an alternative to Chapter 7 bankruptcy for debtors who do not qualify to file for Chapter 7 protection. If the debtor can propose a feasible repayment plan and meet certain other requirements, the debt can be repaid through a court-ordered installment plan.
The monthly Chapter 13 payment amount is often determined by the debtor's ability to pay. In some cases, the debtor is only required to repay part of the debt.