Deciding to file for chapter 7 bankruptcy in Fort Worth is not easy. By the time someone is considering bankruptcy, they have normally tried everything they could to solve their financial problems. The most common reasons that people file for bankruptcy are overwhelming medical bills and a lost job. Although credit cards might be maxed out, the cards were probably used to keep the lights on, not to buy luxury items.
The Pros of Chapter 7 Bankruptcy
1. The harassing phone calls and letters will stop. As soon as the bankruptcy is filed, an automatic stay prevents creditors from further collection attempts.
2. Chapter 7 bankruptcy proceedings are finished in about six months, not years.
3. All or most debts will be discharged, allowing an opportunity for a fresh start. A few debts cannot be discharged in a chapter 7, including:
* Child support and alimony
* Student loans
* Recent unpaid taxes
* Fines owed to the government
4. Even when some debts remain after the chapter 7 is complete, it should be much easier to pay them without the discharged debts.
5. Employers are not allowed to fire someone because they filed for bankruptcy.
The Cons of Chapter 7 Bankruptcy
1. Chapter 7 is a liquidation bankruptcy. This means that all assets that are not exempt will be sold and the funds used to repay creditors. In practice, most debtors are able to keep most or all of their personal belongings but if there is property that cannot be considered exempt, it will be lost.
2. Chapter 7 will remain as a negative on someone’s credit report for ten years. It will be possible to get credit during this time but the interest rates and fees will be higher. Some credit card offers may appear in the mailbox almost immediately, but they will have prohibitive terms and should not be accepted. By the time someone is considering bankruptcy, his or her credit has already taken a hit. Late payments remain on a credit report for seven years.
3. Younger people are usually affected less than older people by the ding on their credit rating, simply because they have more time to recover from it.
If you’re thinking about filing chapter 7 bankruptcy in Fort Worth, talk to an experienced bankruptcy attorney at The Law Office of David S. Kohm & Associates. Enjoy the relief of a debt-free life. Visit Davidskohmattorney.com to contact the firm.
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