Making the choice to file for bankruptcy is not easy. It's likely this choice comes after months of financial struggles and complications that make you feel out of control. By taking this step, you may be able to regain your financial stability and move forward to the best future possible. First, you must determine which option is most appropriate for your financial situation.
There are two main types of consumer bankruptcy, Chapter 7 and Chapter 13. The right option for you depends on the specifics of your finances, the types of debts you owe and more. There are also eligibility requirements for each chapter. An assessment of your case can help you move forward with the right option from the beginning, helping you reach your goals faster and more efficiently.
Is Chapter 13 right for you?
Chapter 13 bankruptcy is a smart choice for individuals who may not be eligible for Chapter 7. If the following qualifiers apply to your situation, this may be the right option for you:
- You are able or want to make payments according to a bankruptcy plan.
- You do not qualify for Chapter 7.
- You are facing the threat of foreclosure on your home.
- You want to keep personal property that may be nonexempt under Chapter 7.
- You are facing the possibility of repossession of your vehicle.
Chapter 13 works due to an organized, court-approved debt plan that allows you to pay off many types of debt through reasonable payments over a period of three to five years.
Is Chapter 7 right for you?
Chapter 7 is a popular choice for debt repayment because it only takes a few months to complete. However, not everyone who wants to apply for this chapter will be eligible. This may be an option for you if the following apply to your situation:
- You cannot make payments to pay off your debt.
- The majority of your debt is unsecured debt and dischargeable.
- You want to complete the bankruptcy process faster.
This is liquidation bankruptcy, which means that some of your personal property may be subject to liquidation. The proceeds of this process would go toward the repayment of some of your debts.
Making the right choice
If you are unsure of the right way forward, you will find it beneficial to discuss your bankruptcy filing with an experienced Louisiana attorney. He or she can help you understand how you can achieve your goals for your financial future through your bankruptcy filing.