Bankruptcy is often a hard decision to make between the stigma and complexity revolving around it but in today's world it is a choice that many people have to make but don't know whether Chapter 7 or Chapter 13is right for you . Check out this interactive infographic on some bankruptcy basics.
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The though of filing for bankruptcy is not a pleasing one, particularly since it can be so confusing and the stigma follows you (and your credit) for years.
To get started, you must decide if you should file for bankruptcy and which type will work for you.
Current law states that within 180 days prior to filing for either type, you must attend a credit counseling class from an approved credit counseling agency.
While these classes may help you plan the next step in your pursuit of bankruptcy, the following infographic can help you get started in understanding which one may best work for you.
My income is less than or equal to my state’s median income.
(go to the U.S. Census Bureau to calculate)
I have equity in a home and/or autos (or other big ticket items) that I want to keep. (There are certain allowances for both types of bankruptcy, such as the home in which you reside and your vehicle, depending on your state’s laws; see your lawyer for details.)
I have co-signers I want to protect
I have the means (e.g., regular income) to repay my debt within a 5-year payment schedule.
Bear in mind that this chart is quite simplified and is for informational purposes only. Specific laws do vary from state to state and every situation is different.
As always, many experts recommend that you speak to a bankruptcy attorney who will be able to walk you through the process and explain how bankruptcy laws will apply to you.
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