Filing for a chapter 7 or chapter 13 bankruptcies is becoming more popular today than it was a few years back. It seems as if every day someone else is getting laid off of jobs and can’t find work so therefore filing for bankruptcy seems like the best choice. Before filing for either bankruptcy you need to weigh up all options and see if it is a good choice for you or not.
The most popular question asked regarding bankruptcy is: Will everything be lost if I file? Most of the times when you file for bankruptcy you can choose to keep your property which may include the home, personal goods and vehicle. In rare occasions, if your property is worth more than what you owe however they may take it and sell so they can divide it to the people in which you owe.
You may have a chance of losing all your belongings if you choose not to file bankruptcy, as creditors can take court action and attack your bank accounts, deduct from your wages and take your property. As a result, you may be late on rent, mortgage or car payments, making it hard to provide even your every day needs
Can I file alone or does my husband have to file with me as well? If most of the debts are in your name only, your husband may not have to file. Creditors usually cannot hound a spouse who did not file, unless he/she is a co-signor on the account. Then the bankruptcy should not be marked against the spouse’s credit report. The rules do differ, however, from county to county so make sure you check with your lawyer representing you to make sure.
There are two kinds of bankruptcies one is a chapter 13 which means that you and your creditor mutually agree for you to pay them back in monthly payments until your debt is settled with them. A chapter 7 bankruptcy is normally a total bankruptcy which means that you are wiping all slates clean and trying to start over. Both bankruptcies put a mark on your credit which lasts either 10 years or 13 years.
After reaching your options you need to consult with a lawyer or attorney so he can then look at your past history as well as debt to income ratio and give you his or her advice on what you should do in the current situation. Generally there is a minimal charge for his or her fees in the price range of a thousand dollars but having a lawyer can be beneficial by having all the paper work taken care of as well as stop harassing creditors call.
Filing bankruptcy may not be the correct choice for everyone. There are pros and cons that everyone needs to weigh before making that final decision. What is the correct choice for you?
Dawn Enstruthe writes for website Ginko Financial which has details of Chicago credit counseling and home refinancing after a bankruptcy.
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