Troy Ohio Bankruptcy Lawyer: A Comparison of Chapter 7 and Chapter 13 Bankruptcy

Since each bankruptcy case is unique, it is important for an individual to know which option is best. There are many differentiating factors involved; such as, one’s current finances, assets, and ability to pay back debt. These issues can heavily influence whether a Chapter 13 or a Chapter 7 bankruptcy may be the correct choice. Remember, filing for bankruptcy is an important decision that will impact your life and your credit for a certain period of time, a Dayton Bankruptcy Lawyer can help you get through the process with the least amount of repercussion and stress.

A Chapter 13 Bankruptcy is your only choice if you are behind on your mortgage or business payments and you wish to keep your property. A Chapter 13 allows you to make up the delinquent payments over a certain period of time by use of a payment plan. If you have property not covered under the Ohio bankruptcy exemption that you wish to keep, Chapter 13 is your best option for securing this property. Chapter 13 is also commonly filed if an individual makes too much income to file a Chapter 7.

Here are some advantages to filing a Chapter 13 bankruptcy as a pose to Chapter 7:

  • As stated, you can keep your property if you honor the payment plan outlined in your bankruptcy agreement with your mortgage lender
  • Payments to creditors can be reduced
  • You have immediate relief from creditor collection efforts such as wage garnishment
  • If your Chapter 13 agreement includes payment in full of certain debts, your co-signer will be immune from creditor collection efforts
  • You have more time to pay debts that cannot be discharged by either Chapter 13 or 7 such as taxes
  • You can file a Chapter 13 repeatedly and at any time

Ohio residents who wish to simply get out from under impossible or heavy debt burdens, Chapter 7 may be a better choice. These are some examples of the advantages of Chapter 7 Bankruptcy:

  • You are released from debt covered under Ohio exemptions for Chapter 7 bankruptcy, receiving a fresh start pending the approval of the Reaffirmation Document which you sign at the time of filing
  • Wages and property (except for inheritances) acquired after the bankruptcy filing are safe from creditors and the court
  • There is no minimum of debt required for filing

Some things to consider, you can only file Chapter 7 every six years in Ohio. Also, if you are facing foreclosure on your home, Chapter 7 only offers temporary protection from foreclosure. In Chapter 13 bankruptcy, your payment plan can last 3-5 years, meaning you are involved with the bankruptcy court process for the entirety of the payment plan. Because of the length of time you are allotted to pay off your debt under Chapter 13, your cash and earnings are tapped during the 3-5 year bankruptcy process.

Understanding the advantages and disadvantages of both bankruptcy options can be tough; you need a law firm on your side that understands the process and can help you decide which is best. The lawyers at Chris Wesner Law Office, LLC. are here to help, please contact us for more information.

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