Are you filing bankruptcy? Are you unsure if you should file Chapter 7 bankruptcy or Chapter 13 bankruptcy? Friends and family may be advising you to file Chapter 7 bankruptcy so you can quickly receive a discharge of debt, but there are certain reasons that make filing Chapter 13 bankruptcy the right move.
Benefits of Bankruptcy Depend On Specific Life Circumstances:
Not everyone’s life and specific circumstances are the same; they may not even be similar. The vast differences between everyone’s life and circumstances can make comparing bankruptcy cases and benefits difficult. While Chapter 7 bankruptcy can be extremely beneficial, and many bankruptcy petitioners fall right inside the parameters that make them a good candidate for the liquidation bankruptcy, it is not the best choice in every situation.
Top 3 Reasons to File Chapter 13 Bankruptcy:
- Income: Bankruptcy petitioners with a high income are usually not eligible to file Chapter 7 bankruptcy. The intention behind bankruptcy is to provide relief to debtors who have impossible financial obligations. Chapter 7 bankruptcy is reserved for those who meet the means test and whose income is not sufficient to make the payments required for their debt. Generally speaking, if a bankruptcy petitioner has enough income to make their debt payments, they should consider Chapter 13 bankruptcy.
- Assets: When filing Chapter 13 bankruptcy, petitioners retain all their assets. The bankruptcy trustee for Chapter 13 bankruptcy cases does not have control of the petitioner’s assets like a Chapter 7 bankruptcy trustee. If a bankruptcy petitioner has nonexempt assets that they want to keep, they should consider Chapter 13 bankruptcy.
- Expected Future Debt: The bankruptcy codes protections are not limited to the current situation. In some situations, petitioners are seeking help not only for their current debt, but for additional debt they know is on the way and may arrive after they file bankruptcy. In a Chapter 13 bankruptcy, petitioners can convert their Chapter 13 bankruptcy to a Chapter 7 bankruptcy in the future and add additional debt that has occurred since their original filing. Bankruptcy petitioners whose life circumstances indicate they are likely to incur significant debt in the near future should consider filing Chapter 13 bankruptcy.
If you need to file bankruptcy, but you aren’t sure if you should file Chapter 7 or Chapter 13 bankruptcy, discuss your options with an experienced bankruptcy attorney. Don’t hesitate to call Ken Rannick at Kenneth C. Rannick P.C., Tennessee, and Georgia bankruptcy attorney. We help good people through bad times.