Types of Bankruptcy May Be Hard to Understand

When you find yourself in financial ruin, you may decide to file for Chapter 7 bankruptcy. However, you will need to qualify for this type of bankruptcy which, depending on your circumstances, may not be possible. When you don't qualify for Chapter 7, you may have to proceed with Chapter 13 instead.

There are three primary reasons why people are forced to file for Chapter 13: their household income is too high for other bankruptcy types, to make up late car or mortgage payments without losing those assets or to prevent other valuable assets from being sold during bankruptcy.

During a Chapter 7 bankruptcy, you are asked to sell your property to take care of debts whereas Chapter 13 allows you to create a repayment plan. Once the plan has been approved, a bankruptcy judge will give you three to five years to pay off your debts.

It isn't always easy to know which type of bankruptcy you are eligible for. This is why people who are filing for bankruptcy should speak with a San Antonio bankruptcy attorney before taking any action. Don't wait to contact the Malaise Law Firm to get advice and direction from our team of litigators.