Bankruptcy Consultation Near Tuscon

What to Know About Bankruptcy 

When you are filing for bankruptcy, it’s important to know there are different types. Filing for bankruptcy allows people to eliminate or repay some or all of their debt. This can be done through a liquidation or reorganization process. Bankruptcy can help people get rid of credit card debt and medical bills, as well as hold off on foreclosures or repossessions to allow time to catch up on missed payments. With so much to know about the rules pertaining to eligibility, what debts can be discharged, and what property is exempt, it’s best to consult an attorney. The experienced team at Tucson Arizona Bankruptcy can help you when it comes to filing for bankruptcy.

Types of Bankruptcy 

When filing for bankruptcy, there are two different types to know about. Let’s take a look at the differences between Chapter 7 and Chapter 13 bankruptcy.

Chapter 7 Bankruptcy

Chapter 7 bankruptcy, or liquidation bankruptcy, lets people get relief from unsecured debts. To do this, they may have to give up any property that is not covered by an exemption. Any non-exempt property will be sold. The proceeds will go toward paying off creditors. Chapter 7 bankruptcy can help those with credit card debt or medical expenses.

Chapter 13 Bankruptcy

Chapter 13 bankruptcy, or reorganization bankruptcy, lets people keep their property while paying down their debts over a number of years. Under Chapter 13 bankruptcy, you must have the income to stick to the payment plan. Once the payment plan is complete, any unsecured debts may be relieved. Chapter 13 bankruptcy can benefit those in danger of foreclosures or repossessions.