If you are considering bankruptcy protection to address a difficult financial situation, you likely have questions regarding the difference between a Chapter 7 and Chapter 13 bankruptcy and what option is the best strategy for you and your family.
Wisconsin Chapter 7 Bankruptcy
Chapter 7 is designed for debtors whose disposable income meets the Chapter 7 bankruptcy means test, which will take into account your income versus expenses to determine eligibility. Sometimes called the liquidation bankruptcy, Chapter 7 enables a debtor to discharge nearly all unsecured debt such as credit cards and medical bills. Possible exceptions may include student loans and taxes, however, it is worthwhile to discuss your situation with a bankruptcy attorney to determine if even these debts are dischargeable depending on your unique circumstances.
As part of the Chapter 7 bankruptcy process, a trustee will be assigned to your case to sell any nonexempt property you have to pay back creditors. If you have few assets, creditors will receive next to nothing. Exempt property which is off limits to the trustee in a Chapter 7 generally include your home up to a set limit, a percentage of your wages, retirement funds, public benefits, some personal property and tools of the trade required for work. Money needed for alimony and child support will also be exempt. To find out exactly what property is exempt in a Chapter 7 bankruptcy, it is important to work with an experienced bankruptcy lawyer familiar with federal and state bankruptcy laws.
Wisconsin Chapter 13 Bankruptcy
A Chapter 13 bankruptcy is available to debtors who do not qualify for Chapter 7. Chapter 13 allows you to keep all your property by paying back a portion of your debt through a 3 to 5 year repayment plan, which is dependent upon your income, expenses and type of debt. An attractive feature of Chapter 13 bankruptcy is the ability to catch up on missed mortgage and car payments through an affordable payment plan so a debtor can keep that property. At the end of the bankruptcy repayment period, the remaining debt will be discharged giving bankruptcy filers a fresh start.
To Discuss A Chapter 7 Versus Chapter 13 Bankruptcy
Contact Our Experienced Waukesha Consumer Debt Lawyers For Answers
Whether you decide to file Chapter 7 or 13 really depends on your financial circumstances and what your goals are. Researching your options is key. If you have questions regarding Wisconsin bankruptcy protection, we encourage you to call our Waukesha bankruptcy law offices to determine if bankruptcy is a good strategy to solve the difficult financial situation you face. For a fresh start contact our experienced Waukesha consumer debt attorneys for a free consultation at the Law Offices of Andrew C Ladd LLC.