If your debt situation is out of control, there are some things you can do about it. You can start by reviewing your finances and creating a budget. You can try to work with your creditors to lower how much you owe or adjust payment terms so that they are more affordable for you. You can also look into filing for bankruptcy with the assistance of an Illinois-based bankruptcy law attorney if you feel that would best suit your needs. If you choose to go this route, which type of bankruptcy — Chapter 13 or chapter 7 — is right for you?
Chapter 13 and Chapter 7 each have their benefits. Both can result in you achieving debt relief; they just go about it in different ways. Chapter 7 can result in the complete discharge of any qualifying debts — primarily consumer debts. Chapter 13, on the other hand, results in the creation of an affordable payment schedule — so you still pay your creditors, just in a way that works with your current income level. With Chapter 7, you may have to give up certain assets; whereas, with Chapter 13, you will get to keep the majority of your property unless you choose to get rid of it.
Which type of bankruptcy is right for you? It really comes down to your income. Chapter 7 is reserved for those individuals whose income leaves them lacking disposable funds. Chapter 13 is for just about everyone else.
If you are not sure if bankruptcy is the right fit or you are unsure which type of bankruptcy will best suit your needs, legal counsel can help you decide. With attorney assistance, you can take the means test to determine if you qualify for Chapter 7, or if Chapter 13 is your only option. Once you figure out which type works for your income situation, legal counsel can then help you file and get through your court proceedings. To learn more about bankruptcy and how it can benefit Illinois residents like yourself, please take a moment and visit our firm’s website.