Types of Relief
Raleigh Bankruptcy Attorney
The two major types of relief used by consumers are Chapter 7 Bankruptcy and Chapter 13 Bankruptcy. When you decide it is time to file bankruptcy, you will have to make a decision about which is most suitable for your case. Our attorneys at Weik Law Office will help you understand the choices you have in front of you.
In a Chapter 7 Bankruptcy, the courts will completely eliminate certain debt for you. You will no longer be expected to pay credit card debts, unsecured loans or medical bills. There are a few exceptions to the rule. You may have to pay certain secured debts, especially if you agree to reaffirm them. You must also be required to pay child support, certain back taxes, student loans, criminal penalties and debt you came into because you intentionally harmed another person. Being prepared for these exceptions when considering Chapter 7 Bankruptcy can greatly help you make the right decisions and point you in the right direction.
Chapter 7 Bankruptcy is called a straight bankruptcy because it is meant to wipe the slate clean, for the most part, in a very short time. The first thing that will happen is an immediate stop to all collections, harassments, judgments and repossessions. The rules for Chapter 7 are strict, but your attorney will guide you through the paperwork and other steps you need to take in order to succeed in having your Chapter 7 Bankruptcy discharged.
Chapter 13 – Wage Earner Plan
A Chapter 13 is designed for people who earn a wage or get some other monthly form of pay, but do not earn a high enough wage to pay off their debts. Chapter 13 can lead to immediate elimination of some debts, and it does stop creditors from harassing you or taking your property. In this way, it is a valuable form of relief for many people.
Another difference with a Chapter 13 Bankruptcy is that a plan may be devised to pay off a portion of your debt. Some of the unsecured debt can be paid off for a fraction of what you owe. Some secured debts can be revisited and terms can be changed to lengthen payoff times and reduce payments. For example, if you are behind in your mortgage, a Chapter 13 gives you a way to catch up the arrearage within your budget without losing your home.
All these factors are considered together in the Chapter 13 Bankruptcy to come up with a plan whereby the debt will be paid off in 3 to 5 years, as it is developed into a realistic payment plan. The courts allow you enough money to live as you pay on the debts for the allotted time. Even if the debts are not fully paid off in that amount of time, many are scheduled to be eliminated at the end of that period. That is a part of the plan.
No matter whether you decide that a Chapter 7 Bankruptcy or a Chapter 13 Bankruptcy is in your best interest, the attorneys at Weik Law Office are able to facilitate that process. We serve the cities of Raleigh, Durham, Cary, Chapel Hill and Wake Forest in North Carolina. If you need to discuss bankruptcy with our attorneys, call today we’re here to help.
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