In Texas, bankruptcy is a solution for some people and businesses that are facing serious volumes of debt. The claims include most, if not all, the claimant’s debts. The chapter chosen for the claim determines the overall benefits. A local attorney explains all the advantages of bankruptcy in Fort Worth.
An Automatic Stay
An automatic stay is available with all bankruptcy chapters. It stops ll creditors from starting a legal claim against the consumer or business owner. Foreclosures and repossessions are not possible once the automatic stay is in place. Once the bankruptcy case is approved by the court, the automatic stay starts.
Setting Debts at Lower Rates
In chapter 13, the repayment plan lowers the monthly payment submitted by the consumer. During the case, the monthly payment is divided among the creditors. The consumer or business owner doesn’t make several payments to their many creditors. The court combines all payments into one.
The attorney representing the claimant could also acquire settlement offers for certain debts. The arrangement allows the claimant to pay off the debt in small installments. The total value is around fifty percent less than the original debt.
The Discharge of Certain Debts
The bankruptcy court discharges certain debts for consumers and business owners. The primary debts that are discharged are unsecured credit cards. The court won’t discharge government student or business loans. However, some private loans for the same purposes could be discharged.
Becoming Debt Free in the End
The major benefit for claimants is that they could become completely debt-free. In chapter 13, the claimant has up to five years to pay off their debts. In chapter 7, the debts are paid off in around six months. The right plans could help the claimant eliminate their debts without any outstanding balances or possible late charges.
In Texas, bankruptcy offers several chapters that benefit consumers and businesses. The claimant must acquire approval for their preferred chapter by providing evidence of earnings or assets. The chapters present an automatic stay to prevent all legal action against the claimant.
