Harassing phone calls, letters, or emails from creditors can disrupt your life and add to the illusion that there’s no way out. Fortunately, federal law provides qualified consumers with protection from creditors and a clear path to a fresh start. Generally, filing for bankruptcy protection will bring an immediate end to creditor phone calls, lawsuits, foreclosures, repossessions, and wage garnishments.
A Win-Win-Win Alternative
It may seem counter-intuitive, but filing for bankruptcy can be beneficial to all parties involved. The debtor receives immediate relief upon filing in the form of an automatic stay that prohibits creditors from contacting the debtor directly. The stay provides the debtor with well-deserved chance to breathe while the bankruptcy process plays out. Creditors get an opportunity to file their claims within the Bankruptcy case, avoiding the expense of suing the debtor in a separate civil action. The government has a substantial interest in helping overly burdened consumers return to a place of financial stability—citizens who do well financially pay more taxes and inject more money into the economy!
Chapter 7: Liquidation
In a Chapter 7 bankruptcy, debtors may eliminate most types of debts, but in return must surrender assets that are not protected by law. Because the law provides protection for homes, retirement accounts, some automobiles and other property, many debtors do not have to give up any property. A typical case takes about four months and does not usually require an appearance in court.
Chapter 13: Reorganization & Consolidation
In a Chapter 13 bankruptcy, debtors may consolidate their debts by paying into a specially-designed plan (typical plans are 5 years). By complying with the plan, the debtor may be forgiven for a portion of most types of debts which he or she cannot afford to pay. Usually, it is not necessary to give up any assets in a Chapter 13, although you must pay those debts that are secured by collateral that you intend to keep (e.g car, home, etc.). Chapter 13 is often used to stop or prevent foreclosure of the debtor’s home, permitting an opportunity to catch up on late payments over time.
What R&R Can Do For You
For more than 20 years, the attorneys at Risen & Ryan have been helping clients across Northwest Florida get the debt relief they need. If you’re receiving harassing phone calls, letters, or emails from creditors, contact our office today to schedule your free consultation. Risen & Ryan is designated a debt relief agency, pursuant to Federal Law, and our attorneys help debtors file for relief under the Bankruptcy Code. Contact us today for a free consultation to determine if Chapter 7 or 13 Bankruptcy is right for you.
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