It’s sad to learn that a lot of individuals in the United States experience financial failure, which is often the reason they get buried in debts. Aside from the stress of trying to make ends meet, creditors will start harassing them when they fail to make payments.
This is one of the major reasons many of them opt to file for a Chapter 7 bankruptcy petition. If you also feel the need to file a bankruptcy petition, a Chapter 7 bankruptcy attorney from firms like the Law Office of Davis & Jones, P.C. in Salt Lake City can help you. If you’re still not sure, here are just some of the known advantages of Chapter 7.
It provides debtors with a fresh start.
Once your petition has been approved, you’ll be granted with an automatic stay, which provides you with some level of legal protection against your creditors. This means no more incessant calls and letters from debt collectors.
Also, your wages will be safe from garnishment. Aside from the automatic stay, Chapter 7 bankruptcy allows the discharge of all your unsecured loans, which helps give you a fresh start on life as you’ll no longer owe late credit card payments, expensive medical bills, and other debts that are not backed by collateral.
There’s no repayment plan.
Unlike Chapter 13 bankruptcy, Chapter 7 doesn’t require the debtor to have a court-approved repayment plan. This is because Chapter 7 discharges all unsecured debts, so the debtor no longer needs to repay them.
There’s no limitation on the debt amount.
Chapter 7 doesn’t limit the amount of debt a debtor may have upon filing the petition. Chapter 13, on the other hand, imposes certain limitations on the debt amount. If a debtor exceeds this limit, they’re automatically no longer eligible to file for a Chapter 13.
Filing for bankruptcy will seriously affect your credit, as it can stay on your record for many years. However, it won’t stay there forever. Eventually, you’ll enter a recovery phase and your credit score will start to rise again. It won’t happen overnight, but this is better than remaining in debt, which will just continuously deteriorate and ruin your credit.