The Perks Of Chapter 13

chapter 13As a consumer you might find the differences in bankruptcy cases to be a bit confusing. While many people seek total debt elimination through Chapter 7, the truth is that not everyone will qualify or benefit from a Chapter 7 case. Chapter 13 bankruptcy can provide a unique advantage for many people who are concerned about their secured debt assets and looking to repay their debts with a little help.

The Benefits

A Chapter 13 case gives you a chance to resolve debts through a repayment plan that suits your budget. In most cases, you will have anywhere between three to five years to pay off your debts through the Chapter 13 plan. Making payments towards your debts in a Chapter 13 case ensures several things.


First, secured debt assets are protected from liquidation or repossession in Chapter 13. Debts such as mortgages and car loans are better managed in a Chapter 13 case, in which you continue to make payments in order to keep possession of the asset. Having secured debts in a Chapter 7 case cannot guarantee their protection or that you will be entitled to keep the asset.

Second, your credit standing is better protected through debt satisfaction rather than settled or elimination. Future creditors look more favorably on debt repayment over debt elimination. Further, debt collections will be put on hold during the process, allowing you to repay your debts without being hassled by creditors. For many, repaying debts through Chapter 13 can allow more flexibility and less stress than traditional debt resolution strategies.




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