Most people look at Chapter 7 bankruptcy like it is the end of the world, but there are many benefits of the process that could change the average bankruptcy filer's mind. Indeed, Chapter 7 should not be looked at negatively. Those who file for Chapter 7 bankruptcy are actually getting a fresh start on their finances, and they have the opportunity to dramatically reduce their stress and increase the quality of their financial lives.
Let's take a look at three important benefits of Chapter 7 proceedings:
-- It's fast: One important benefit of Chapter 7 proceedings is the fact that it is very fast. In fact, the average Chapter 7 filing takes about three to six months to complete. Although filers will have a lasting mark on their credit records, they will gain the freedom from the majority of their debts within this time.
-- A lot of your property will be exempt from liquidation: One of the primary concerns of Chapter 7 filers is that they will have to sell off all of their personal possessions. The fact is that Chapter 7 filers will be able to keep most of their possessions -- especially the things they need. Filers get to keep the property they buy and the money they earn after filing Chapter 7 proceedings, and up to certain limitations, they will be able to keep their homes.
-- You'll be able to get a credit card sooner than you think: Chapter 7 filers often fear that they won't be able to get a credit card for seven years after filing for bankruptcy. However, most will be able to get a new line of credit (though at a higher rate of interest) within one to three years of their bankruptcy filing.
There are many more benefits of filing for Chapter 7 proceedings, particularly the fact that all debts covered by the process will be eliminated. If you or your loved one is suffering from debt that you don't know how you will pay down, a bankruptcy lawyer can help you learn more about your legal rights and options.
Source: FindLaw, "Pros and Cons of Declaring Bankruptcy under Chapter 7," accessed Dec. 14, 2016