Filing for bankruptcy is not an easy decision to make, and it can have many consequences, both positive and negative. While many people are most familiar with the negative effects of bankruptcy, it also offers some important but little-known benefits. As a top Chapter 7 bankruptcy lawyer like one at The Law Offices of Neil Crane can tell you, it can be beneficial for people looking to complete the bankruptcy process efficiently or want to keep their possessions.
Stops Creditor Harassment
Being incessantly contacted by creditors who want to collect debt payments is one of the biggest nuisances that individuals struggling with debt experience. Filing for Chapter 7 bankruptcy can immediately put a stop to creditor harassment. They are forbidden from contacting you through phone, email or other method once the bankruptcy process is initiated.
Discharges Most Types of Debt
Chapter 7 bankruptcy can discharge most types of debt, such as credit card debt, utilities, and personal loans. Not all types of debt are forgiven under Chapter 7 bankruptcy, so be sure to check that your type of debt qualifies under this type of bankruptcy.
Your Debts Are Discharged Faster
Unlike other types of bankruptcy that are completed over years, Chapter 7 bankruptcy can be done in just a few months. The average time that debts are discharged generally takes about four to six months. You do not have a payment plan unlike Chapter 13 bankruptcy.
You Can Keep Your Home
For homeowners who want to keep their home, filing for Chapter 7 bankruptcy can allow them to keep their home, property and other obsessions. It also gives you time to re-organize your finances so that you can better manage your mortgage payments.
Improve Your Credit Score
Another benefit of Chapter 7 bankruptcy is that it allows you to gradually improve your credit score. While your score may be lower initially after filing for bankruptcy, you can expect to increase over time as long as you maintain good financial habits, such as making your payments on time.
Each person has a unique financial situation, so it’s important to take the time to gather enough information about whether or not bankruptcy is the best debt relief solution for you. Weighing the pros and cons of such a major decision will take some time. To obtain more information about the benefits of filing for Chapter 7 bankruptcy, contact a top Chapter 7 bankruptcy lawyer to set up a consultation.