CONSUMER CHOICE 4
Based on your personal circumstance, bankruptcy can be filed against all creditors. Bankruptcy has very strict qualification guidelines depending on type of bankruptcy. Bankruptcy also stays on consumer credit report for minimum of 10 years. There are different types of Bankruptcies available based on your eligibility. Once you file for Bankruptcy, the chance of rebuilding your credit is very low. It would take a very long time to rebuild your credit.
Types of Bankruptcies:
- Chapter 7 Based on your eligibility, if you or your company or corporation cannot afford to pay back debts, Chapter 7 Bankruptcy can eliminate all or some of your debt.
- Chapter 11 Based on your eligibility, If you or your corporation has significant amounts of debt that you cannot afford to pay back at the current rate, Chapter 11 reorganization restructures them so you can catch up and repay what you owe at a pace you can afford.
- Chapter 13 Based on your eligibility, If you have less significant debts (under the limits set for Chapter 11), Chapter 13 reorganization allows you to restructure your debt so you can catch up and repay what you plus a fixed interest rate. Percentage of consumers finishing a chapter 13 bankruptcy is less than 5%.
Bankruptcy Frequently Asked Questions FAQ’s
Q. Do bankruptcy laws make it nearly impossible to qualify?
A. Qualifying for a bankruptcy is solely based on your current income and assets.
Q. Isn’t filing for bankruptcy expensive?
A. Filing for bankruptcy could be expensive depending on the attorney you hire.
Q. Will I lose everything if I file for bankruptcy?
A. Not necessarily.
Q. Won’t I still have to pay back my debts?
A. Only in chapter 13 bankruptcy you must pay the entire balance plus interest.
Q. Is it true that I’ll never be able to own property again?
A. No. Many people are able to buy homes after just 3 to 5 years.
Q. Since I’ve filed for bankruptcy before, is it true that I can’t ever file again?
A. No. You can file Chapter 7 every eight years and Chapter 13 every four years.
Q. Does filing for bankruptcy ruin my credit?
A. Yes, once a bankruptcy is filed, very few creditors will be able to extend credit to you and if they do so, they would charge you a very high interest rate.