Filing bankruptcy isn't something anyone wants to do, but if you find yourself needing to, it is best if you know what different types there are and the pros and cons to them. What is chapter 13 bankruptcy? Also known as a wage earners plan, this type makes it possible for those with sustainable income to repay their debt. It is up to their creditors what the repayment is set at, according to uscourts.gov.
As an article on findlaw.com states,
pros of filing chapter 13
- You have more times to pay off your debts
- You may be able to pay your debt over a longer period of time
- Creditors cannot demand payment in full once you enter into an agreement under chapter 13
- You get to keep your property while paying back the debt
- You may be able to get a line of credit from a credit card company after paying your bill from one to three years
- Bankruptcy prevents lenders from calling you continuously
Cons of filing chapter 13:
- It can take as long as five years to pay off your debt
- Chapter 13 must be paid out of the money you have left after paying bills , such as mortgage, rent or car payment
- Chapter 13 can stay on your credit report for 10 years
- You lose all credit cards and cannot get a new one
- You may not be able to obtain a mortgage
- Filing under chapter 13 will make it harder to file a chapter 7
- Bankruptcy doesn't take away alimony or child support payments
- You're still responsible for student loans
We, at the Law Offices of James C. Shields would be happy to answer any questions you might have regarding bankruptcy. Please contact us for assistance.
