Your income may have some bearing on your ability to file for bankruptcy under a particular circumstance. Losing your employment may have a significant impact on your ability to pay the bills you incurred while you assumed your career was secure. Loss of income coupled with a significant debt load is one of the factors that force people to file for bankruptcy.
But it is very difficult to file for or keep up with Chapter 13 bankruptcy if you do not have a steady source of income. It is easier to pass the “means test” and file for bankruptcy under Chapter 7 if you recently lost your job. Regardless of your situation, an experienced Ulster County, NY bankruptcy attorney can provide you with sensible advice on how to navigate the system.
Chapter 7 or Chapter 13 filings are the most common. You’re not alone if you don’t understand how the two differ. Here is an easy explanation of Chapter 7 versus Chapter 13 filings.
Understanding Chapter 7 filings:
For several reasons, Chapter 7 is often selected as the first bankruptcy option. It is effective for those of us who own only the necessities for living and working. Another advantage is that it doesn’t take much of your time, and you don’t pay any money to the creditors, so it is also inexpensive.
Understanding Chapter 13 filings:
Although Chapter 13 filers have to settle a portion or all of their debts using a three- to five-year repayment plan, it has certain advantages that Chapter 7 does not. Filers can potentially avoid foreclosure or repossession by keeping all of their property, including their house and car, which is a significant advantage. Additionally, Chapter 13 enables filers to compel a creditor into a payment plan if they have a debt that cannot be eliminated through bankruptcy.
The major drawback of Chapter 13 is that it can be costly. The monthly payment demanded by the repayment plan is sometimes out of the reach of many people.
If you have never previously filed for bankruptcy, you will meet the initial criteria. If not, see if sufficient time has passed for you to file again. The time frame for waiting varies according to the prior chapter that was filed and the chapter that you intend to file. If you need the help of a professional in evaluating your case, get the help of a bankruptcy attorney today.