: Reese Baker & Associates

  Filed under: bankruptcy

Our society provides an essential tool for those people with debt problems. Being able to file bankruptcy helps good people get back on their feet. Bankruptcy prevents creditors’ efforts from collecting from you, and in the long-term, bankruptcy eliminates payment obligations to free up your finances.

Don’t Wait Too Long

Bankruptcy does not always have to be a last resort; sometimes, your legal rights can be lost if you wait too long to file. If you need to save your home or car from being seized for nonpayments, you will want to consult with a bankruptcy attorney to find out how you can keep your secured property. It will be too late if your home is already seized and sold. 

At the end of a successful bankruptcy, all qualifying debt will be discharged. What this means is that you will no longer be legally responsible for paying that debt. Depending on the type of personal bankruptcy you choose, a Chapter 7 or Chapter 13, either all or some of your unsecured debt will be discharged. Unsecured debt includes credit cards, medical bills, loans, and past utility bills. 

Secured Debt

If you have mostly secured debt, your attorney will probably advise a Chapter 13 bankruptcy. In this type of bankruptcy, you keep your secured debt by making court-approved back payments for three to five years. You will need to make your monthly payments if you wish to continue to use the collateral. Filing bankruptcy stops the foreclosure process and the risk of having your vehicle repossessed. 

Chapter 7 is the most common personal bankruptcy and the easiest. This type of bankruptcy is usually completed in three to six months. At the end of this time, all of your unsecured debt will be discharged.

If you have questions if bankruptcy is right for you, contact a Houston bankruptcy attorney.