Chapter 7 bankruptcy is about discharging your debt legally so you can get a fresh start financially. Many misunderstand their options when it comes to bankruptcy. In other cases, they don’t take the time to study how bankruptcy will help. Even more often, they don’t ask for help or ask the wrong people. This blog guide helps you discharge the most debt with a Chapter 7 bankruptcy, guiding you through unsecured and secured debts you can eliminate.
Discharging Debt
Once a debt is discharged, you are free of any personal liability you have for these debts. So if you discharge $20,000 in credit or medical debt, for example, you will be completely free of these debts. There are certain types of debt you can and can’t discharge with a bankruptcy, and also some which you may not want to discharge in order to keep assets.
You can discharge medical, credit, mortgage, and many other debts. Some debts such as alimony, child support, and taxes cannot be discharged. Still more debts you may not want to discharge, such as your mortgage debt or car debt; if you do, you can lose them. In order to get help in this situation, contact an experienced Texas bankruptcy lawyer.
When are you discharged?
In a Chapter 7 case, you are typically discharged of debt in a matter of months. In a Chapter 13 bankruptcy discharge, it takes much longer – usually about 4 years time.
Discharging Secured Debts
You can discharge your mortgage and car debts. If you owe a lot of money on them and have decided not to fight to keep them, being free of the debt is a big help. Also, discharging secured debts such as your home does not mean you are homeless immediately. The “automatic stay” made by the judge after filing puts a hold on all collections against you. And you can likely keep your home for several months without paying a penny, just be sure to find a new residence.
Unsecured Debt
Unsecured debts are the prime reason to file Chapter 7 bankruptcy. The Texas economy is strong in comparison to other states with high numbers of bankruptcies and foreclosures, but debt is of course still a problem, In fact, many lack health insurance, end up having to get medical help, and then end up in danger of losing all their assets. If you have unsecured debt you simply cannot afford, usually you have the right to discharge it, even if it’s very high. If you have $100,000 in credit and medical debt, for example, you can be free of it in a matter of months.
Texas Bankruptcy Experts
You need a lawyer if you want to successfully file Texas Chapter 7 bankruptcy. It will be easier in and out of court. You will rarely have much of a role in court, but out of court you’ll be making some key decisions. In order to keep the most assets and discharge the most debt, hiring a lawyer is very important.
