Deciding to take the leap and file for a Chapter 13 bankruptcy is a choice that most people, whether they reside in Michigan or elsewhere, do not make without some serious thought and consideration. It can be difficult to know if it really is the best thing to do for one's situation. While, with bankruptcy law as it is, there can be some negatives to going this route, there are also a lot of positives that can, if one's financial situation is severe enough, outweigh any bad points.
What are the benefits of submitting a Chapter 13 bankruptcy petition? The most significant benefit with any bankruptcy filing is the financial relief it can provide if approved. With a Chapter 13 filing, all eligible debts will be combined into one affordable repayment schedule. The details of one's repayment plan will be determined by one's current income and debt load, with a plan submitted to the court for approval.
Along with the affordable payment schedule, for homeowners anyway, another benefit with a Chapter 13 bankruptcy is the ability to avoid foreclosure. This may not be possible with other bankruptcy forms. Other significant benefits include:
- Co-signer protections
- Credit reporting lasting only seven years
- Three to five year repayment plans
- Protection from creditors
A Chapter 13 bankruptcy is not for everyone. It is meant for individuals or couples who have steady incomes, but still lack the ability to keep their debt obligations current. Michigan residents who are on the fence about whether this is a good fit for them or those who are ready to bite the bullet and submit a petition can seek guidance and support from an experienced bankruptcy law attorney. With legal counsel at one's side, the right steps can be taken toward achieving a fresh financial start whether that is through a bankruptcy filing or other debt relief option.
Source: uscourts.gov, "Chapter 13 - Bankruptcy Basics", Accessed on May 9, 2017