Do you have debt that’s so heavy it’s affecting your peace of mind? You probably thought about filing for bankruptcy, specifically Chapter 7 bankruptcy. Chapter 7 bankruptcy deals with asset liquidation to tackle debts like medical bills and credit card balances.
There are some benefits to filing for Chapter 7 bankruptcy. Here are four of them below.
1. Flexibility with asset liquidation
When it comes to handling secured debt, you’re required by bankruptcy law to mention possessions like your vehicle and any properties you own. Fortunately, you can make exemptions for any of your possessions so that you can keep them.
2. The debt discharge process is quick
Filing for Chapter 7 bankruptcy takes about two to three months. During this time, a court commences a discharge order. Then, said court closes the case once the trustee distributes your assets to creditors.
3. You don’t have to worry about a debt limit
A downside to Chapter 13 is that it requires you to meet a debt limit. To be specific, your unsecured debt cannot exceed $419,275, and your secured debt can’t go over $1,257,850. Chapter 7 has no debt limit, making it easier for you to file for bankruptcy.
4. Chapter 7 stays on your credit report for only a decade
Some people are reluctant to file for bankruptcy because it shows up on credit reports. Even though Chapter 7 remains on your credit report for ten years, it provides ample time to rebuild your credit and get a fresh start. Most people can secure credit again very quickly.
Filing for Chapter 7 bankruptcy — or any type of bankruptcy — is something many people would rather avoid. However, attempting to pay off a massive debt alone could be worse. Do you want to know more about how Chapter 7 can help you handle your debts? Legal guidance can help.