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How Chapter 13 Bankruptcy Works

Consumers who do not qualify for Chapter 7 bankruptcy or who would rather avoid liquidation may qualify for Chapter 13 bankruptcy, otherwise known as "reorganization bankruptcy." This form of bankruptcy takes longer, but has less of an impact on the consumer's assets and property. Under Chapter 13, a consumer will sit down with creditors and work out a repayment plan for the next three to five years. During the term of the plan, the individual will continue making affordable payments on the debts. Any debt that remains after the repayment period is over is then discharged.

Pros And Cons Of Chapter 13 Bankruptcy

In general, Chapter 13 reorganization bankruptcy is considered to be the better option over Chapter 7 liquidation bankruptcy. You are not required to liquidate your home, car or other property and assets when you file under Chapter 13. This is a major benefit, but the downside is that reorganization bankruptcy takes much longer than liquidation bankruptcy. Should you file under Chapter 13, you will have to wait three to five years before the process is complete. Even so, the result is the same. Your debts will be eliminated, leaving you free to afford your payments and rebuild your credit from scratch.

Find An Experienced Bankruptcy Lawyer In Grapevine

Are you struggling with debt and looking for a way out? Powell Law Offices, P.C., can answer your questions and help you make an informed decision regarding your debt relief options. If bankruptcy is the right choice for you, Lauren Powell can guide you step by step as you seek to erase your debts. Schedule a free consultation with Lauren Powell today for personalized, one-on-one attorney attention from start to finish. The sooner you contact us, the sooner we can begin to help with your debt!

We are a debt relief agency. We help people file for bankruptcy relief under the Bankruptcy Code.