Did you know that you have bankruptcy options when it comes to getting out of debt? Most people think that bankruptcy is a one size fits all arrangement and that they can just file a cheap bankruptcy. The truth is that there are different chapters under the bankruptcy code and different methods under each chapter. The code is set out to accomplish something it particular and that is to provide either a way out of debt or a way to reorganize debt over time. With each chapter, I would recommend the services of a local bankruptcy attorney who has the requisite experience to get you the results that you are looking for. Do not assume that all attorneys are the same in terms of skills. This thinking could lead to a poor choice of attorneys.
The first option that you should consider is that of Chapter 7. Chapter 7 provides for a fresh start most of the time. If the debt is mostly unsecured debts, such as credit cards, medical bills and personal loans, the debts will likely be eliminated. If the debts are student loans, recent taxes and child support obligations, then the debts will not be eliminated. This is why you should talk with and meet with a Chapter 7 bankruptcy attorney to learn your rights. There is no sense in filing a bankruptcy case to later learn that most of the debt will remain.
The second option to consider is that of Chapter 13. Chapter 13 is a reorganization of your debts over a period of thirty-six to sixty months. The amount of the payment plan is predicated on your available income per month. Thus, if you are showing a large surplus each month, then you are likely to pay a higher amount to the Trustee than if you were showing little available per month. It is important to bring proof of your income when you meet with your lawyer. Part of the bankruptcy advice that you will receive is whether or not your case is feasible. If so, the court would be likely to approve of your payment arrangement and confirm your case.
The last things to consider are your alternatives to bankruptcy. Not everyone needs to file a bankruptcy. There are other options available such as repayment plans directly with creditors. Another option may be to avoid collection efforts altogether. If you are not working and if you have no significant assets, you may not need to file. Most people make the decision to file once they receive court papers threatening to garnish wages. If you are not working, you certainly do not need to fear a wage garnishment. If you are working, you should be concerned about a garnishment.