Four Reasons Chapter 7 Bankruptcy May Be Right For You
- If you are low or no-asset debtor, it is unlikely that you will need to pay any money to your creditors or be required to liquidate any of your assets. Because of the bankruptcy codes’ generous exemptions system, many Chapter 7 bankruptcy debtors are able to protect all of their assets from seizure during bankruptcy. Because of bankruptcy exemptions, most Chapter 7 bankruptcy debtors are able to protect their home from foreclosure by filing bankruptcy. But it should be noted that if a debtor keeps their home in bankruptcy, they will be required to continue to pay their mortgage.
- Chapter 7 bankruptcy is usually a quick 90 t o 100 day process. When a debtor does not file bankruptcy, creditors can pursue that debtor for years, file lawsuits, garnish wages and even seize bank accounts with a court order. But once a debtor files bankruptcy they are approximately 3 months away from being debt free and on the road to a new financial start.
- Chapter 7 bankruptcy can stop creditor harassment and collection actions immediately. Once a debtor files Chapter 7 bankruptcy an automatic stay is put into effect prohibiting all creditors from attempting to collect on any debt owed by the bankruptcy filer. This makes bankruptcy very effective in stopping foreclosure, lawsuits and even wage garnishments . If a creditor attempts to collect on a debtor who has filed bankruptcy, they may face sanctions.
- Chapter 7 bankruptcy is a lot less stressful than handling scores of creditor calls, letters and lawsuits. Most Chapter 7 bankruptcy debtors are only required to attend a 5 to 10 minute meeting with the bankruptcy trustee which is called the “meeting of creditors.”