Most people who want to file for bankruptcy start by learning more about Chapter 7. They do so because it’s fast, there’s no repayment plan and it gives them the opportunity to start fresh.
However, there’s another option: Chapter 13 bankruptcy.
There are many benefits of Chapter 13 bankruptcy, including but not limited to the following:
- More time to make payments: Through a repayment plan, you have up to five years to make your payments. By stretching your debt over a longer term, you can often reduce payments to ensure that they fit into your budget.
- Keep your property: As long as you continue to make payments through your repayment plan, you’re able to keep that property. This is much better than a situation in which you put your assets at risk.
- Less impact on your credit : A Chapter 13 bankruptcy filing remains on your credit report for seven years. That’s a long time, but it’s three years less than Chapter 7 bankruptcy. This may not sound like a big deal now, but it will be in seven years.
The future is bright
As you prepare for Chapter 13 bankruptcy, such as by learning more about the pros and cons, it’s easy to assume that your finances will never be the same. While you’re up against a variety of challenges, the future is bright.
Once you file for Chapter 13 bankruptcy, you’ll soon realize that you have a better grip on your debts and financial circumstances as a whole. This gives you the confidence you need to proceed.
From there, as the weeks turn to months, you can take steps to improve your credit score. For example, you should continue to make payments through your repayment plan, all while looking for new ways, such as a secured credit card, to regain credibility.
No one wants to file for bankruptcy, but don’t shy away if you find that it’s the best way to improve your finances and prepare for a better future.
There are many benefits of Chapter 13 bankruptcy, and when you take advantage of them your personal finances will get the boost they need.