Types of Bankruptcy

IMG_1109Bankruptcy can sound scary, but it might be something you have to consider at some point. It can be a tough decision to make because it will have a dramatic impact on your life. It is important to research the different types of bankruptcy to find out what your options are.

Chapter 7

This is the most common type of bankruptcy, and it is for people with little to no income. Chapter 7 bankruptcy generally lasts from 3 to 6 months. This type of bankruptcy allows the individual to retain household goods and clothing, and also sometimes your home and vehicle. Once Chapter 7 bankruptcy is complete debts have been discharged.

Chapter 13

Chapter 13 bankruptcy lasts a little bit longer. This bankruptcy can last between 3 to 5 years. This bankruptcy is for people with a regular income who can pay back a portion of their debts through a repayment plan. In this plan, you get to keep all of your property as you pay back your debts. Chapter 13 is often referred to as reorganization bankruptcy because you can catch up on missed payments.

Knowing your options is the first step to fixing financial issues you may be having. There are resources out there for you to use, so make sure you find the information you need to get where you want to be financially.

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