The advantages of filing a Chapter 7 bankruptcyPosted on September 1, 2016 by Michael Hoverson
Minneapolis residents who find themselves in over their heads financially may want to consider bankruptcy as a relief alternative. An experienced bankruptcy attorney can help ease that burden dramatically, and make an emotional process as smooth as possible under the circumstances.
Typically, people can choose to either undergo a Chapter 7 or a Chapter 13 bankruptcy. Where there is an option, most debtors prefer to go through a Chapter 7 bankruptcy because it discharges most debts without paying the creditor anything. Also, in most cases you do not lose any of your property. Chapter 7 has many advantages.
A new start. When a person is freed from most of their debts, they are given the chance to enjoy a new start. While most debt can be eliminated, some things, such as student loans, child support, taxes and property liens will still remain.
No debt limits. Chapter 7 does not impose a debt limit, unlike a Chapter 13 filing.
No repayment plan. With a Chapter 7 filing, there is not court-approved repayment plan, which there is with a Chapter 13 filing. Once the Chapter 7 bankruptcy is discharged, there are no more debt repayment obligations.
Faster settlement. Discharge of debts in a Chapter 7 can take place in as little as 90 days after a debtor files for bankruptcy.
No attachment of future wages. Once a Chapter 7 bankruptcy is discharged, there are no strings attached to future earnings of the debtor. The only exceptions are if the debtor acquires property through an inheritance, divorce or life insurance proceeds within 180 days after filing for Chapter 7.
Re-establishing credit. Although you’ll lose all of your credit cards in a Chapter 7 filing, you will be able to re-establish credit within one to three years after filing.
Hoverson Law Offices proudly serves the city of Minneapolis and surrounding Minnesota communities.