Bankruptcy
Finance

Converting from Chapter 13 to Chapter 7 Bankruptcy

Are you finding the payments for Chapter 13 bankruptcy tough to deal with? If yes, you may like to convert your filed case to Chapter 7 bankruptcy to get yourself out of troubled waters.

Increased transparency and ease of filing

Are you aware if the reasons that drove the IRS to re-institute income tax source related with holdings in the period of World War II? Diminished transparency was one of the main factors that were making it difficult for authorities to to raise the pertinent taxes in future. For taxpayers dealing with cumbersome forms and filings, as opposed to real dollars present in their pocketbooks, the tax increases were not nearly as noticeable. Do know that, at least in this respect, the bankruptcy forms happen to some what like tax forms.

For instance, a $100,000 secured debt would essentially be merely theoretical; until the debtor’s family and himself start making significant sacrifices per month for making the debt consolidation repayments a reality. Believe it or not, such sacrifices are worthwhile in the long run. This is one of the primary reasons why Chapter 13 bankruptcy happens to be an effective credit re-building instrument. Along with reinforcing the lessons of accurate and responsible budgeting, it also lays down the groundwork for future financial decisions. However, in certain cases, the debt consolidation payments may become unmanageable. Such a situation may occur because of unexpected financial turmoils or on a month-to-month basis. Under the circumstances, it becomes essential for debtors to choose an alternative path to avoid further duress and stress – such as convert to Chapter 7 bankruptcy.

Bankruptcy

In Chapter 7 bankruptcy, as a debtor, you agree to allow the trustee (the person who supervises the bankruptcy on behalf of the judge) to liquidate your non-exempt assets. This liquidation would be in exchange for near immediate discharges of all unsecured debts to your name. If you are among those debtors who do not have any non-exempt assets, unless you have managed to invest in vacation homes or yachts in your good times, you may like to surrender any secured assets to those moneylenders who hold the notes.

In case of Chapter 13 bankruptcy, you would be working with your attorney as well as the trustees for developing repayment plans which would last for either 3-5 years. You will be in a position to take care of the secured debt arrearage as well as keep your secured property. Also, once the repayment period ends, all the remaining unsecured debts would be discharged. The good thing is that as per the regulations laid down by the Bankruptcy Code, you will be given the absolute rights for making Chapter 13 bankruptcy repayment and converting to Chapter 7 liquidation bankruptcy at any given point of time.

Are you game? Speak to your bankruptcy attorney today!