Bankruptcy is a Tool
Stay updated with practical articles addressing bankruptcy.
Bankruptcy is a Tool
Frequently Asked Questions About Bankruptcy
What is the difference between Chapter 7 and Chapter 13 bankruptcy?
Chapter 7 bankruptcy allows for the discharge of most unsecured debts, providing a fresh start by liquidating non-exempt assets. Chapter 13 involves a court-approved repayment plan to reorganize debts over three to five years without asset liquidation.
How long does the bankruptcy process typically take?
Chapter 7 cases usually conclude within four to six months, while Chapter 13 cases last between three to five years, depending on the repayment plan duration and court schedules.
Will bankruptcy affect my credit score permanently?
Bankruptcy impacts credit scores but is not permanent. Chapter 7 remains on your credit report for up to 10 years, and Chapter 13 for up to 7 years. Responsible financial behavior post-bankruptcy can improve your credit over time.
Can I keep my home or car during bankruptcy?
Depending on your case type and exemptions, you may retain your home or car. Chapter 13 often allows you to keep assets by including payments in the repayment plan, while Chapter 7 may require liquidation if exemptions don’t cover them.
How do I know if bankruptcy is the right option for me?
Evaluating bankruptcy depends on your debt level, income, and financial goals. Consulting with an experienced attorney can clarify your options and help determine the best path forward based on your circumstances.
