When people consider filing for personal bankruptcy, it’s crucial to consider the difference between Chapter 7 and Chapter 13. A bankruptcy attorney in Belvidere, IL, can explain how these plans work and advise prospective clients on which would probably be best for their particular circumstances.
Chapter 13
Chapter 13 involves creating an installment payment arrangement lasting up to five years. All the debts are bundled into one monthly payment. Many men and women want to pay their obligations and find this option appealing. Unfortunately, a high percentage of those approved for this program end up defaulting.
Chapter 7
In contrast, the other program discharges all qualifying debts after the person pays as much as is deemed reasonable considering the financial situation. A bankruptcy attorney in Belvidere, IL, may recommend this option even if the client theoretically can afford the installment payments. Often, the payment plan leaves the person with so little money each month that any unexpected large expense results in default.
Beginning the Process
A bankruptcy lawyer provides counsel on the most reasonable strategy after reviewing the prospective client’s financial situation. The individual needs to bring lists of outstanding obligations and any assets that are still left. These attorneys typically offer free consultations so that those who are struggling financially can gain some insight. The person may begin to feel some hope when considering Chapter 7 because it involves starting over with a clean slate.
Contact information for the Crosby Law Firm can be found on their website.
