3 Things That Chapter 7 Bankruptcy Is (and 2 Things It Is Not)

If you have found yourself struggling with debt, you may have considered bankruptcy. Even if many people do not understand the details of the process, most people have a general idea of what it is about. That said, how familiar are you with the specific chapters? When an individual files, he or she has two choices: File for Chapter 7, or file for Chapter 13. In this article, the focus will be the former: What is Chapter 7? Without further ado, here are three things to know about this form of individual bankruptcy, as a bankruptcy lawyer, like from Chorches Bankruptcy Law, can explain.

  1. It Is a Way to Escape Drowning Debt

When someone is facing significant debt and earns below a certain income level, Chapter 7 is one solution available to them. With this form of bankruptcy, the court usually eliminates most, if not all, unsecured debts. If you cannot pay rent because you are trying to make minimum payments, this might be an option.

  1. It Is a Way to Start over

While there is still some stigma associated with filing for bankruptcy, the truth is that it gives you a new beginning. With Chapter 7, you can forget about past debts once you receive a discharge. Imagine what you could do with a fresh start.

  1. It Is a Way to Make Life Less Stressful

How is your mental health these days? Financial burdens can make life extremely difficult for individuals as well as families. Filing for Chapter 7 is one way to eliminate many of the stressors that can weigh a person down.

Okay, so there are three things this form of bankruptcy is, but what about what it is not? Even though bankruptcy can offer individuals a lot of relief, there are many myths that still surround the process. While you are researching Chapter 7, here are two things to know it is not.

  1. It Is Not the End of Your Financial Future

Although you might hear filing for Chapter 7 is the end of your financial future, it is not. Rebuilding your credit will take time, but you will have opportunities to do so. The key is patience.

  1. It Is Not a Sign of Personal Failure

The number one reason people file for bankruptcy in the United States is due to excessive medical bills. The second leading cause is job loss. Everyone comes to bankruptcy from a different walk of life, and none of them deserve judgment.

If you have been considering bankruptcy and wondered about Chapter 7, it is important to separate fact from fiction. You may hear some common myths, but focus on reliable information and do what is best for you.