Bankruptcy can be a confusing topic, don’t be discouraged. Use our resources to understand how bankruptcy in Joliet, Illinois is different.
What is Chapter 7 Bankruptcy?
The thought of facing Chapter 7 Bankruptcy can be very daunting for those who have not had much exposure to the process. There are many people who live in fear of bankruptcy and may be afraid that they will lose everything and have a black mark on their records forever. However, these worst case scenarios are seldom true, and there are actually many advantages to declaring Chapter 7 bankruptcy in Joliet. One of the biggest advantages to declaring Chapter 7 is that you can put an immediate stop to the creditor threats and harassment.
What is Chapter 13 Bankruptcy?
Chapter 13 Bankruptcy is the preferred bankruptcy for individual debtors with a steady income and small businesses because it is a way to pay off debt without jaw-dropping interest payments and hassle from creditors. With Chapter 13 bankruptcy, you are placed on a payment plan and have 3-5 years to pay back your debts. As a consolidation plan that is regulated by Federal Law and the Bankruptcy Court, once a plan is confirmed, creditors will be required to accept payments according to the terms of the plan or not get paid at all.
Chapter 7 Bankruptcy vs Chapter 13 Bankruptcy
There are several types of bankruptcy out there. If you are considering bankruptcy as a relief valve for your escalating debt, knowing the difference between the various bankruptcy types can really help you out of financial turmoil. Specifically important is understanding the difference between filing Chapter 7 or Chapter 13 bankruptcy, as these are two common types for individuals seeking a way out of crippling debt.
The Pros and Cons of Chapter 13 Bankruptcy In Joliet
Many residents of Joliet have faced challenging financial circumstances lately, due to the economic collapse of 2008. As is the case all over the U.S., people in Joliet have looked to bankruptcy as the double edged sword that can ultimately provide relief from crushing debt. Like the above metaphor suggests, bankruptcy can be used to remedy your financial issues, but the remedy comes with a price that you must consider before plunging into the process of filing for Chapter 13 bankruptcy in Joliet.
What is a Means Test for Bankruptcy?
For people who do not own a home or many other assets chapter 7 bankruptcy is often the preferred choice. Filing chapter 7 bankruptcy discharges your debt allowing you a fresh start. However, you must first be eligible for the type of bankruptcy that you are looking to file. In the case of Chapter 7 bankruptcy, those in Joliet looking to liquidate their assets and eliminate their overwhelming debt must pass a means test to file for bankruptcy.