Bankruptcy Law at Option 1 Legal
Debt is a natural part of life in today’s world. Few people can afford to purchase a vehicle or home outright, and having a credit card or two on hand for emergencies can actually improve your credit score. Debt isn’t necessarily a bad thing, but when you have more debt than you can afford, your financial future could be in jeopardy. Are you ready to take control of your debt? Option 1 Legal can help.
Many things can lead to debt getting out of control, including job loss, health problems and more. A late or missed payment can lead to penalties, fees and skyrocketing interest rates. Before you know it, you’ve got more debt than you can safely handle. Option 1 Legal can help you regain control of your debt and improve your financial outlook.
Bankruptcy is a legal process that offers formal debt relief. Consumers typically file for one of two types of bankruptcy: Chapter 7 or Chapter 13. Chapter 7 is often called liquidation because assets are liquidated to pay the debts. Chapter 13 is often called a reorganization because the debts are paid under the supervision of the court over a three to five-year period.
The Bankruptcy Process
Once you file for bankruptcy, you’ll be protected by an automatic stay, which stops many types of collection activities. Your debts and assets will be carefully evaluated to determine the best type of bankruptcy for your needs. If you are eligible for a Chapter 7 petition, your unsecured debts will be discharged at the conclusion of the filing, including credit card debts, medical bills and personal loans. Some of your assets could be used to pay your debts, but exemptions can help protect your home, vehicle and other property so that you can rebuild your finances at the conclusion of the bankruptcy.
If you file for Chapter 13, your debts will be reorganized, allowing you to repay them over a period of three to five years. The court will oversee your repayment plan and ensure creditors are paid as agreed. You’ll be able to keep your property, and once the bankruptcy program is complete, any remaining unsecured debts can be discharged.
Bankruptcy can affect your credit score, but because your debts are discharged at the conclusion of the case, you’ll have more available cash and be better positioned to rebuild your credit rating and forge a new financial future.
Option 1 Legal can help you decide if bankruptcy is the right choice for you. Although the laws surrounding bankruptcy can be complex, the process itself is fairly straightforward. If you’re ready to move into a debt-free future, we’re here for you. Contact our team today to schedule your free case evaluation.