There are two common chapters of bankruptcy: chapter seven and chapter thirteen. Both have benefits and downfalls, but either option can help debtors take control of their expenses and eventually allow them to rebuild their credit. The distinction between the two is how they work. Chapter thirteen is a structured repayment plan that allows creditors to recover some of the debt. Chapter seven is a liquidation that allows creditors to recover as much as possible. When liquidating assets, some property is exempt from sale and will not contribute to repaying debts. Anyone can file for chapter seven as long as the money owed is not primarily consumer debts.
Just like any form of bankruptcy, chapter seven eliminates any legal obligation to repay creditors that existed before the filing process. New debts will still need to be paid as agreed or the debtor could still face legal consequences. Certain property can be taken in order to repay debts, but assets such as homes and main vehicles cannot be taken. Luxury items such as a boat or extra cars can be taken and sold in order to repay some or all of the debt owed to creditors. Any other debts will be dismissed unless the debtor filed a chapter seven within the last eight years or a chapter thirteen in the last six years. These stipulations may change, so it’s important to research options before deciding to file chapter 7 bankruptcy in Cincinnati, OH. Eligibility can be determined by taking the means test. A lawyer can help fill out the paperwork for this test.
Before making the decision to file chapter 7 bankruptcy in Cincinnati, OH, it’s important to talk to a lawyer. There are many stipulations and guidelines that need to be followed in order to successfully file. The debtor must attend a credit counseling course and provide a certificate of completion as part of the initial paperwork. Talking to a lawyer is critical in the early stages of filing. A single mistake could lead to delays that allow creditors to take legal action. Debtors can schedule an appointment today and get help understanding the filing process.
