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New Bern, North Carolina, Bankruptcy And Debt Relief Blog

Chapter 7 and Chapter 13 bankrupty. What's the difference?

If you are considering bankruptcy, you may have heard of the terms Chapter 7 and Chapter 13 and wondered which would be better for you. Knowing some important differences in how these bankruptcy cases work can help you stay informed as you navigate this process.

Chapter 7 and Chapter 13 petitions address two different types of debt situations by presenting two divergent solutions. Your attorney can give you more tailored advice based on the facts of your case.

What happens to non-dischargeable debt in a bankruptcy?

Filing a Chapter 13 or a Chapter 7 bankruptcy in North Carolina can help substantially when you need a fresh start. However, there are some debts you will remain on the hook for even after bankruptcy.

Understanding the basic rules can help you as you make your decisions. Ultimately, talking to an experienced attorney about your circumstances is the best way to get the guidance that will work best for you.

Understanding Chapter 13 bankruptcy

If you are under financial stress and wondering how you can deal with mounting debt, bankruptcy may present a solution for you. Chapters 7 and 13 of the U.S. Bankruptcy Code detail two ways individuals may file for bankruptcy. Understanding how each of them work can help you figure out the right path for yourself.

In contrast to a Chapter 7 filing, which entails selling off non-exempt assets and paying part of the debt from the proceeds, Chapter 13 has a structured repayment plan as its cornerstone. Over a period of three to five years, a Chapter 13 debtor makes monthly payments to cover all or part of qualifying debts.

Bank of America facing huge fine over couple's mortgage disaster

People who begin having difficulty with their mortgage payments often hear the advice to work out a payment modification plan with their lender. Unfortunately for one California couple, such an attempt resulted in disaster.

Recently, U.S. Bankruptcy Judge Christopher Klein slapped Bank of America with a $46 million fine for the egregious way it treated a couple trying to work out a payment plan. The documents in the court case related how the couple contacted Bank of America to ask for modifications as they were experiencing financial difficulties. Representatives told the couple they could not get a modification until they stopped making payments.

Are these bankruptcy myths holding you back?

Filing for bankruptcy is a serious decision. It can be a fresh start for your finances if you understand the process and know what the bankruptcy does for you. Some people are afraid to file for bankruptcy because they are afraid of what other people will think and how it will affect their property and credit. Learn more about these myths that might be keeping you from getting a bankruptcy.

What is chapter 7 bankruptcy?

The vast majority of people are trying their best to do what they can with what they have. However, sometimes circumstances prevent people from covering all of their expenses. This can get to the point where large amounts of debt can influence every single decision you make and drastically increase levels of stress. Even so, there may be options available.

While it has consequences on the rest of your life, declaring bankruptcy can provide you with an opportunity to rearrange your finances and to get your financial feet back on solid ground. There are multiple types of bankruptcy, but depending on your circumstances chapter 7 bankruptcy may be your best option.

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