A glance at the pros and cons of Chapter 7 bankruptcy

bankruptcy

The global pandemic has caused unparalleled damage. If you lost your job during the Covid-19 crisis or are dealing with unexpected financial distress, talking to a bankruptcy attorney could be an option. That said, bankruptcy shouldn’t be your first choice. There are other debt relief methods, such as debt settlement and debt consolidation, which can be useful for some individuals. If you decide to file for bankruptcy, you have two options – Chapter 7 and Chapter 13. The latter is more a repayment plan, while Chapter 7 allows you to discharge most of your unsecured loans and start afresh. If you need Chapter 7 bankruptcy help in Las Vegas, there are some great law firms to consider. In this post, we are sharing the pros and cons of Chapter 7 at a glance. 

Table of Contents

The pros

  • Once you have filed for Chapter 7, you get an automated stay. This means that your creditors and lenders cannot harass you anymore for payments. 
  • Creditors cannot also go after the wages you earn in the future. The income that you earn after bankruptcy is filed is yours to keep. 
  • If you already own a mortgage, you can keep the house as long as you can make payments on time as per the repayment schedule. 
  • Chapter 7 allows you to discharge most of your debts, including credit card bills, medical records, and other unpaid bills. You can literally start with a fresh slate. 
  • Note that not everyone qualifies for Chapter 7 bankruptcy. You have to check with an attorney to know about your unique financial circumstances. 

The cons

  • Your bankruptcy records are available in the public domain. However, considering the ongoing financial crisis, you have nothing to be ashamed of. 
  • While you can keep the house and car, you may lose some of your valuable things, including expensive watches and personal belongings. 
  • Bankruptcy will appear on your credit card for at least a few years, and therefore, it can be impossible to get a mortgage. 
  • Finally, Chapter 7 doesn’t discharge some debts, including student loans, alimony, and child support. 

Now that you know the basics, it is wise to consult a reliable and experienced lawyer in NV to discuss the pros and cons of your case. Sometimes, a person may benefit more from Chapter 13 then Chapter 7. It all depends on the case, and therefore, do not assume anything right away. An attorney will also ensure that you get the paperwork right and don’t make common mistakes. 

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