Chapter 7 Bankruptcy
Chapter 7 bankruptcy stops the harassing telephone calls of creditors, credit card debt, medical debt, and other unsecured debt. If you want to surrender your house to the mortgage company and not pay for the house or any deficiency on the mortgage, you have this choice in chapter 7 bankruptcy. If you are not current on your mortgage and you want to keep your house, however, chapter 13 is more appropriate. Chapter 7 does not allow you to keep your home unless you are current on the payments. Neither Chapter 7 nor Chapter 13 can reduce your mortgage payments. In fact, if you are in arrears, Chapter 13 allows you to pay your regular payment plus something towards the arrears, spread out over time, to allow you to get caught up on your mortgage payments, which chapter 7 cannot do. Essentially, the same applies to vehicles. You can keep your vehicle if you are current on the payments, but not if you have missed some payments. To keep a vehicle that is not current on the payments, a chapter 13 is necessary to pay the payments plus something towards the arrears until caught up. Chapter 7 is a liquidation bankruptcy. It is for people who make less than median income, are current on their mortgage and vehicle payments or want to surrender their homes and/or vehicles.
Some things are not dischargeable in bankruptcy, such as taxes, child support, alimony, and federally backed student loans. These debts pass right through the bankruptcy and are still owed after the bankruptcy case is concluded.
The automatic stay of bankruptcy is a federal law that states, in essence, that once you file for bankruptcy, all collection activities are stayed, or put on pause, until the bankruptcy court has a chance to make a decision in the particular collection action, lawsuit, garnishment, repossession, or foreclosure. Most creditors stop trying to collect once you file a chapter 7 bankruptcy case, because the case tells the creditor your intentions to either surrender or get caught up on payments.
To determine whether you qualify for a Chapter 13 bankruptcy or whether a Chapter 7 is best for your situation, call a competent bankruptcy attorney today. Higgins Law, LLC, has filed literally thousands of personal bankruptcies in chapter 7 and chapter 13, and has many, many satisfied clients. Call today: (863) 325-0343.