A bankruptcy can harm a debtor's credit report and complicate their ability to obtain loans. But, a Chapter 7 bankruptcy does not always prevent the ability to reestablish credit or purchase a home. A Chapter 7 bankruptcy involves the liquidation of many types of assets and the discharge of most debts. It stays on a credit report for 10 years after a debtor files for bankruptcy.
Creditors struggling with debt may have to consider filing for bankruptcy. A Chapter 7 bankruptcy allows the discharge of a range of debt and can provide a fresh start. The time for filing is when a creditor is struggling with debt and tried to negotiate with creditors, work with a credit counselor or consolidate debt.
A person may declare bankruptcy more than once. However, there are different time periods for a Chapter 7 and Chapter 13 bankruptcy and other serious considerations. Chapter 7 bankruptcy is the most-recognized and is a discharge of all eligible debts, such as credit cards and hospital bills. Tax debts, child support and student loans are among the debts that cannot be discharged and must be repaid. There is an eight-year wait for refiling a second Chapter 7 bankruptcy.
A Chapter 7 bankruptcy does not provide debt relief for college loans unless the debtor can meet the strict requirements for showing an undue burden. But, a bill introduced in the U.S. House of Representatives could broaden the definition of undue burden and increase eligibility for discharging student loan debt.
Veterans have some special protections under the law, but they also face some hurdles, bureaucratic and otherwise. A veteran receiving disability benefits who undergoes Chapter 7 bankruptcy will face some unique obstacles. Disability benefits are counted as income and hamper a veteran's chances for achieving a discharge of their debts and a fresh financial start.
Bankruptcy can lead to a fresh financial start through debt liquidation. But, a Chapter 7 or Chapter 13 bankruptcy appearance on a credit report can place obstacles to seeking credit and reestablishing a new financial profile. There are ways to speed up the removal of bankruptcy on reports. Reestablishing credit can open a new financial future, grant access to loans and even lead to high credit scores.
Consumers in Pennsylvania, like the rest of the country, have overextended themselves through credit card purchases and other debt. One of the legal means to resolve these debts and seek a financial fresh start is to declare Chapter 7 bankruptcy. Choosing to utilize this type of filing depends on their financial situation.
Bankruptcy can help a Lehighton resident who is behind on their bills and who cannot find the extra income to get caught up. It can help individuals take control of their financial health and work down their debts so that they may have better control over the bills they do maintain. There are a variety of different forms of bankruptcy that debtors may choose to pursue and one of the most utilized of them all is Chapter 7 bankruptcy.