The Benefits of Filing for Bankruptcy: Why File for Bankruptcy
Bankruptcy is a legal process that helps relieve individuals and businesses of their debt. There are different types of bankruptcy; the best option for relief depends on a person’s assets and financial situation. Ultimately, bankruptcy is a way to get peace of mind and a fresh financial start. In Burrow & Associates’ latest blog, we’re discussing the benefits of filing for bankruptcy and why you may want to file bankruptcy in Georgia.
Chapter 7 Bankruptcy
With a Chapter 7 bankruptcy, individuals can eliminate their outstanding unsecured debts – which includes credit cards bills, medical bills, personal loans, amounts due on surrendered or repossessed vehicles, and rent from a prior residence. (Child support, alimony, and student loans generally cannot be eliminated). A Chapter 7 bankruptcy is best suited for those with minimal assets or lower incomes.
Chapter 13 Bankruptcy
A Chapter 13 bankruptcy involves the repayment of debts in a structured, court-supervised manner. An individual will establish a repayment plan, detailing how much they’ll repay each month, over a specific period (usually 3-5 years). Chapter 13 is best suited for individuals who want to protect their assets and have income to support a monthly Chapter 13 plan payment. Individuals who file Chapter 13 are often looking for relief from mortgage companies threatening to foreclose on their home or car creditors threating repossession.
When you file for Chapter 7 or Chapter 13 bankruptcy, an automatic stay goes into effect. An automatic stay is a court order that prevents creditors from starting or continuing any debt collection activities, such as a debt collection lawsuit. It also protects against foreclosures, repossessions, and wage garnishments. An automatic stay provides immediate relief and will typically remain in place for the duration of your bankruptcy case.
A bankruptcy discharge, also known as a debtor’s discharge, is a bankruptcy court order that relieves a debtor from their obligation to pay certain types of debts. After the bankruptcy court issues the discharge, the creditors cannot contact the debtor, file a lawsuit over the discharged debts, or garnish the debtor’s wages or bank account. They can, however, still enforce liens on secured debts or repossess the collateral for loans if the debtor does not continue to make payments. With a Chapter 7 bankruptcy, most unsecured debts can be discharged. Depending on your financial situation, unsecured debts in a Chapter 13 bankruptcy may also be discharged. Bankruptcy discharge is one of the primary reasons why an individual would want to file for bankruptcy and is essential for a financial fresh start.
Contact the Bankruptcy Experts at Burrow & Associates
If you are considering bankruptcy, it’s important to know all your options. The decision why to file and when to file are highly dependent upon your own financial situation and needs. Experienced bankruptcy attorneys are your best guide through the decision-making and filing process. If you are thinking about filing in 2021 or if you’re struggling with debt or a recent job loss, please contact the bankruptcy experts at Burrow & Associates at (678) 323-2394 to help you determine whether bankruptcy is the right choice for you. We offer free consultations and have six offices conveniently located in Duluth, Athens, Gainesville, Conyers, Kennesaw, and Morrow. We will file your bankruptcy for no money down.