New York, NY-Any individual, who is has is carrying a great deal of debt, has probably considered bankruptcy. This is an important decision which affects a person’s credit, and while it may give temporary relief from creditors it is important that before you hire a bankruptcy lawyer to enter this debt relief plan you should be aware of the pros and cons.
One of the cons of a Chapter 13 bankruptcy filing is it that it can take up to five years to pay off your creditors. But on the upside, you will be given more flexibility in a repayment plan. Under this plan you can ask for reduced payments or surrender the property you are making payments on. If you have completed a Chapter 13 repayment plan, your creditors can no longer ask you to pay them in full.
You will lose all of your credit cards and bankruptcy will make it impossible to get a mortgage loan. A Chapter 13 filing will affect your credit ratings for at least 10 years. However, it is easier to explain bankruptcy to lenders than property liens, foreclosure, repossession, or missed debt payments. Chapter 13 shows you have taken responsibility for your debts and have taken steps to satisfy creditors.
Debts like student loans, child support and alimony are not dischargeable through bankruptcy.
The biggest benefit of hiring a bankruptcy attorney is that you can stop collection activities. This often entails harassing phone calls and threatening letters, making you afraid to answer your phone or open your mail. For many debtors stopping this harassment is the biggest benefit of filing for debt relief.
There are a lot of different pros and cons of filing for Chapter 13. Your bankruptcy lawyer can detail all of the good and bad things about bankruptcy protection, allowing you to make an informed decision.