Bankruptcy is something people use when they cannot find another way out of their debt problems, and it can be a great solution in many cases. It is always important, though, to understand what the effects of bankruptcy would be if you use it. If you are leaning towards using Chapter 7, here are three facts that are vital to know before you file.
You Cannot Use This Branch If You Make Too Much Money
Were you aware that Chapter 7 bankruptcy is limited to people who are not high-earners? There are income requirements in place that determine whether you can or cannot use this particular branch. If you make more money than average people, you would not have the option of using this branch. Because of this, it is always a good idea to keep your options open when thinking about bankruptcy, as you might not know if you would qualify for Chapter 7 or not. A bankruptcy attorney can tell you if you qualify simply by performing a simple test based on your income and family size.
You Could Lose Things You Own
The second fact you should know about Chapter 7 is that there are risks, and the main risk is losing things you own. You can receive so many benefits from this branch of bankruptcy, including the forgiveness of your debt, but there is a slight catch in return. This catch is that the court can remove things from your possession. They generally do this only when the items are valuable and have a lot of equity in them. Cash is one thing you could lose, but you could also lose cars, an RV, a boat, or a coin collection you own.
You Will Finish Your Case in Less Than One Year
The third fact to know about Chapter 7 is you can normally complete a case in less than one year. Chapter 7 bankruptcy cases are relatively quick and require only one court appearance in most cases. If you are looking for the fastest way to get through a bankruptcy case, this would be the branch that you would want to choose if you qualify for it.
Do you feel like you need serious help with your debt problem? If so, Chapter 7 could be a good tool to consider using. To find out more, contact a bankruptcy law firm to schedule an evaluation visit with an attorney.