People in Indiana rely on being able to borrow money to make major purchases and it is important not only for people’s lives but also helps the economy when people take out loans. Having debt is not really a bad thing when people are able to manage it. However, life is unpredictable and sometimes circumstances can change quickly. People may suffer significant injuries, incurring expensive medical bills and also miss time at work. People also may lose their job, losing their only source of income.
When these events occur, people may find themselves in a situation where they are no longer able to make the monthly payments on their loans. This may cause them to incur even more debt simply to keep up. Eventually the debt may become overwhelming and people may be constantly dealing with calls from various creditors. People who find themselves in this position may be able to rid themselves of their debt though. One option is by filing for bankruptcy.
There are two main types of bankruptcy individuals usually turn to: Chapter 7 and Chapter 13. The main difference between the two is that with Chapter 7, assets are liquidated to pay debts and most remaining debts are discharged. With Chapter 13, a repayment plan is created and people continue to make payments through the plan. Once they complete the plan, any remaining debt may be discharged.
Advantages of Chapter 13 bankruptcy
While people need to continue making payments through Chapter 13 bankruptcy, it does have some advantages over Chapter 7. One is that they can stop the foreclosure process and may be able to keep their homes. They also can keep other property that have secured loans which would be liquidated through Chapter 7. It also consolidates debts and can allow people to lower their overall debt payments.
It can seem like people with overwhelming debt in Indiana may never be able to rid themselves of it, but people may be able to achieve a fresh start through bankruptcy. Experienced attorneys understand this process and may be able to guide one through it.