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Chapter 13 or Chapter 7 Bankruptcy, Which Is Right for You?

Chapter 13 and chapter 7 are the two most used chapters of bankruptcy in Henderson, Clark County, and throughout Nevada.  Figuring out which one your qualify to use and which chapter would benefit you and your family the most takes a little research.  The bankruptcy means test will be used to see if you qualify for a chapter 7 bankruptcy or if you are above on the means test, you may have to choose a chapter 13 bankruptcy. 

Infographic: chapter 13 vs. Chapter 7 bankruptcy

Chapter 13 Bankruptcy in Henderson

Chapter 13 is an option for eliminating debt, but it is different than Chapter 7 filing. Ch 13 is designed for filers who have regular income with enough left after monthly bills to pay back a portion of debt via a repayment plan. This type of reorganization bankruptcy offers benefits not available with Chapter 7. In the case where a client does not qualify for Chapter 7 bankruptcy protection, our attorneys look at Ch 13 as an option. You keep property, including non-exempt assets, and pay back some of all of your debt. A repayment plan is one of the main differences in bankruptcy chapters in Nevada. This plan organizes the amount that each creditor will be paid, the length of time the plan will be in effect, and the value of the debtor’s property. A trustee is involved in the repayment plan, and the bankruptcy court must confirm and approve the plan in order for the Chapter 13 bankruptcy to be successful and proceed.

Because of the complexity of a Chapter 13 and the repayment plan, you want to make sure to involve an attorney. Henderson Bankruptcy Lawyers have extensive experience filing Ch 13 cases, and will help you through the entire process, including completing the plan. For the most part, debtors who file Chapter 13 do not qualify for Chapter 7, but need debt relief. Also, clients who need to stop a wage garnishment, stop a lawsuit, stop a foreclosure, or lower credit card payments opt for Chapter 13.
Some debts are not wiped out in a Chapter 7, for example child support payments, student loans, or alimony. Chapter 13 reorganizes such debts so they are likely to be paid off between three and five years in the Chapter 13 repayment plan. Clients with serious debt issues that are behind on car or house payment who want to keep property and assets can get caught up on missed payments. For these reasons, Chapter 13 in Nevada is referred to as the “Wage Earner’s Bankruptcy”. Sometimes, even though experiences financial hardships, a person makes too much money to file for Chapter 7. Definitely an alternative to liquidation or Chapter 7 bankruptcy, Chapter 13 may allow you to repay debt and keep your home/property.
Contact our Henderson bankruptcy Lawyers law firm today and find out if chapter 13 bankruptcy in Nevada is the debt relief remedy that best suits your needs.

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