The entire country is presently facing a difficult economic situation. If you are running out of money and you might consider bankruptcy as an option. It is one way that you can get a fresh start.
Bankruptcy laws were enacted to help honest people who run into common problems get a new start through the elimination of the majority of their debts. Depending upon the type of bankruptcy that you choose you may also be able to pay your debts over an extended period of time.
A Chapter 7 bankruptcy will be able to offer you the best fresh start as you can eliminate most, if not all, of your debts. Sometimes you can also keep whatever property that you might have. Chapter 7 bankruptcy allows a person to eliminate unsecured debts like personal loans, medical bills, and credit card charges. Those who file for a Chapter 7 bankruptcy may be able to keep their home and one vehicle if they continue to keep up the payments on those items.
Chapter 7 bankruptcy, however, cannot usually eliminate student loans, debts for most taxes, and debts enacted by the courts for such things as criminal acts or personal injuries caused by driving under the influence of alcohol or otherwise impaired. It cannot relieve a person of debts for child support, some types of alimony, maintenance, and support, and legal debts for fines, penalties, or criminal restitution.
A person may also file for a Chapter 13 bankruptcy. This type of bankruptcy allows a person pay his debts with monthly payments to a trustee. Usually payment plans are over a three- to five-year period.
When filing a Chapter 13 bankruptcy, the payment plan is based on monthly income, monthly expenses, and amount and nature of debt. Often people file a Chapter 13 bankruptcy to repay mortgage arrears or back amounts owed, and to restructure auto loans to save a car or some other vehicle.
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