What Are The Pros and Cons of Chapter 7 Bankruptcy?

Pros and Cons Of Chapter 7 Bankruptcy

What Are The Pros and Cons of Chapter 7 Bankruptcy?

Filing Chapter 7 Bankruptcy can be the fresh-financial start that one may need in order to regain control of their finances. It can also be a savvy financial strategy as well. There are many reasons that one might consider filing for bankruptcy and for Chapter 7 in particular.

Such as to get out from under the financial burden of a recent divorce or separation. Other may consider this move seeking relief from collection calls and past due medical bills. Others among us made foolish mistakes with credit cards and money in general when we were younger and now would like to clean that up.

There is another side to consider as well though. While bankruptcy can be considered a fresh start in many aspects. It does not serve as get out of jail free card in all circumstances. Some debts such are non-dischargeable. Examples include student loans, personal injury claims due to a DUI, IRS tax bills, child support/alimony, etc.

Further, a Chapter 7 bankruptcy stays on your credit report for 10 years. Though its effect will diminish over time. It could make big purchases more difficult in the short-term.

Often times you are able to keep your car, and home, as well as other life necessities type of items. Along with a certain amount of personal items referred to as Exemptions. How much depends on a variety of factors. Namely what State you live in and whether you file through your States courts or through a Federal court. There are pros and cons to each decision.

Deciding to file for Chapter 7 bankruptcy should not be done lightly and we are always here and happy to answer any questions you may have about the process. Or about what strategy works best for your individual set of circumstances.

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Devon Barclay PC

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