Benefits of Chapter 7 Bankruptcy
Trying to overcome mounting debt can be challenging, especially in the face of a medical crisis, job loss, or other financial disaster. You might feel overwhelmed with creditor calls and see no clear path forward. Fortunately, there are options available that can help you rebuild your finances.
When given an option, many people prefer to file chapter 7 bankruptcy instead of chapter 13 because it gives them a fresh start by discharging medical bills, personal loans and credit card debt and helps them recover faster.
Below, we discuss the benefits of filing chapter 7. Our experienced chapter 7 bankruptcy attorneys can guide you through the chapter 7 bankruptcy process, explaining the pros and cons based on your particular situation.
We have handled more than 9,000 cases for individuals and businesses, including chapter 7, 11, and 13 cases. We focus exclusively on bankruptcy, and our firm includes three board-certified bankruptcy specialist attorneys.
There is no pressure to file since we will only do what is best for you. Read on to learn more about the advantages of filing chapter 7 or give us a call at (919) 319-7400.
The Chapter 7 Process Is Fast
Unlike with chapter 13 bankruptcy, which can take years to complete, the chapter 7 bankruptcy process is fast. Most cases are resolved in three to four months from when the case is filed.
The normal process is:
- Your initial consultation with your bankruptcy attorney through phone, video call or in person.
- Compile information, documents and take the credit counseling course on the internet which typically takes 45-90 minutes
- The filing of your petition
- Your 341, meeting
- Your required debtor education course can be done on the internet and takes about two hours
- Your discharge order from the court unless there is an objection to discharge or Motion to Dismiss in which case the issue has to be litigated
For many people, the discharge order is provided 95-105 days after their initial filing. This short timeline helps you to financially recover more quickly and to ease your emotional distress caused by overwhelming debt. Within a few short months, you can realize a dramatic and positive change in your life.
Your Debt Is Discharged
One of the major advantages of filing chapter 7 is that it can wipe out all or most of your debt. Your debt is discharged, meaning that you no longer have a legal obligation to pay it. The discharged creditors get whatever they get, and you are under no obligation to pay them any more money.
With chapter 13, you have to agree to a repayment plan and commit future income to pay off debt for the next several years. This is not the case with chapter 7 bankruptcy. Your future income is not tied up. This may allow you greater financial freedom.
You Get Relief from Creditor Harassment
When you are behind on payments, you may receive calls from creditors. These harassing communications can drain you emotionally and leave you feeling frustrated and /or discouraged. A bankruptcy filing stops calls and harassing communications.
Additionally, when you file chapter 7 bankruptcy, there is an immediate pause put on any legal proceedings or enforcement actions. This is because an automatic stay is granted once you file chapter 7 bankruptcy.
This orders your creditors to stop:
- Calling, writing, or otherwise contacting you
- Attempting to repossess your property
- Foreclosing on your property
- Trying to garnish your wages or levying bank accounts
You May Be Able to Keep Your House or Car
Some people are worried about filing for chapter 7 bankruptcy because they are worried about losing their property. Chapter 7 bankruptcy is sometimes referred to as a “liquidation” bankruptcy because the bankruptcy trustee can sell property to pay off debts.
However, it may be possible to eliminate your debt without sacrificing your home, car, or other property due to North Carolina’s exemptions.
These may include:
- Up to $35,000 in home equity for your primary residence
- Up to $60,000 in home equity if you’re age 65 or older
- Up to $3,500 for one vehicle
- Up to $5,000 in household goods plus $1,000 for each dependent
- Up to $5,000 in a wildcard exemption
- Wages earned in the prior 60 days you need to support yourself or your family
- Many types of retirement accounts
A knowledgeable bankruptcy attorney can evaluate your particular circumstances and maximize your exemptions. If you have lived in North Carolina less than two years then you may need to claim the Bankruptcy Code exemptions or the exemptions of the state where you resided two years ago.
You’ll Get a Fresh Start Financially
Eliminating your debt gives you a financial fresh start. Since you no longer have to pay on these debts, your money is freed up to help support you and your family. Many people who file for chapter 7 bankruptcy see their credit score rise shortly after their filing.
Even though bankruptcy will remain on your credit report for several years, its effect will lessen over time. You will have the chance to show prospective creditors that you can handle credit responsibly.
Keep in mind that if you have secured debt that was not rolled into your bankruptcy, you may still need to pay on these debts to keep your property. Our knowledgeable bankruptcy attorneys can evaluate your situation and make recommendations about the best way to resolve your debt.
You’ll Become Eligible for Loans Again
If you are considering filing for bankruptcy, you likely experienced a period where you may have missed payments. Each missed payment has an adverse effect on your credit. When you file for bankruptcy, you may actually show that you are a better credit risk for creditors.
This is because you are no longer saddled with previous debt, so you’ll have more money available to pay on future expenses. You may start receiving offers for loans and credit soon after your filing.
Contact a Chapter 7 Bankruptcy Lawyer Today
If you are considering filing chapter 7 bankruptcy, the knowledgeable and experienced bankruptcy attorneys at Sasser Law Firm can help. We will review your specific situation and make a recommendation about how to best resolve your debt, whether that is through a bankruptcy filing or another option.
Our dedicated attorneys help clients every day who are suffering from financial distress, including in emergency situations such as when clients are facing foreclosure or repossession. To date, we have helped more than 9,000 clients address their indebtedness.
When you retain the services of Sasser Law Firm, you’ll work directly with an attorney. We can provide you straightforward, upfront information about fees so you won’t have to worry about any surprise billings or fine print. Learn more about your options by calling us today at (919) 319-7400 or contacting us online.