If you’re facing debt woes, you’re probably looking for a way out of your struggle. At the same time, you might be worried about what bankruptcy will mean for your hard-earned assets. After all, some bankruptcy proceedings, such as those filed under Chapter 7 of the bankruptcy code, require you to liquidate many of your assets to pay off creditors as fully as possible.
What about Chapter 13 bankruptcy?
Fortunately, if you hope to keep some of your key assets, like your home and your car, you might be able to pursue Chapter 13 bankruptcy. If you qualify, which will require you to show that you have consistent income, you’ll be placed on a repayment plan that will last a set number of years. Once you complete that plan, your remaining debts may be discharged.
Other advantages to Chapter 13 bankruptcy
While keeping your assets is a major benefit to the Chapter 13 bankruptcy process, it’s not the only good thing that can come from it. For example, given that you maintained your ability to repay some of your debts throughout your repayment period, a Chapter 13 bankruptcy will look better on your credit report compared with a Chapter 7 filing, the latter of which will stay on your report for an additional three years.
Chapter 13 bankruptcy might also provide protection to those who co-signed on your loans. Generally, creditors won’t be able to reach your co-signers, which will help protect their financial stability and maybe even your relationship with them.
Are you ready to alleviate your debt burden?
If so, now is the time to act on your personal bankruptcy. That can be as simple as continuing to read up on the bankruptcy process and figuring out the best way to take the formal steps that you need to kickstart your case. By doing so, you’ll hopefully protect your future and your long-term financial security while giving you the quick relief that you need.