Nearly everyone takes on some kind of debt in their lives. Debt is often the easiest choice when you can’t pay off goods immediately and wish to pay them off at a later date or you wish to build up your credit score. However, debt can easily get out of hand without a budget
When dealing with your debt, you have many options, but one of the most common and fastest choices is Chapter 7 bankruptcy. What’s Chapter 7 bankruptcy? Here’s what you should know:
Liquidation bankruptcy for your debt
People often pick up at least one credit card in their life, but, after you own your first, you’ll likely see a flood of offers in your mail. Many credit card offers can be tempting and people often spend more than their means without realizing the repercussions.
Some debt can be unexpected, often caused by outrageous medical bills after an accident or health scare. Many adults have health-care debt ranging from $500 to $10,000. Theoretically, debtors can pay off their purchases or medical debt in the future, but this can be hard to do when interest or late fees are added on.
For individuals with outstanding debt, one of the quickest ways to fight it off is by filing for Chapter 7 bankruptcy. Chapter 7 bankruptcy, also called liquidation bankruptcy, helps debtors pay off some or all of their medical, credit card, business or utility debt.
Chapter 7 bankruptcy, however, may require debtors to liquidate some of their assets – but, this shouldn’t cause you to shy away from filing for bankruptcy. Many assets are safe from liquidation. You may find that your home, car and some valuables are exempt from liquidations, but a summer home or second car is considered non-exempt.
You may find that, after filing for Chapter 7 bankruptcy, you’ll start receiving fewer calls from debt collectors. Bankruptcy has the added benefit of stopping creditors from hounding you down to pay off your debt.
If Chapter 7 bankruptcy sounds like the right plan for you, you may need to reach out for legal help to ensure you’re taking the right steps.