Being in a tough financial situation can cause huge amounts of stress, and this stress can make it difficult to make logical and well-considered decisions. Knowing how to deal with overwhelming debts in the best way can be challenging, especially because there are so many possible options.
If you are feeling that your finances have become a heavy burden on your life, it is important to take your time to find a solution that will work best for you. By conducting careful research on the possible options, you will have the best chance of finding a way out of your financial troubles. The following are ways in which filing for Chapter 7 bankruptcy may be able to help you.
Chapter 7 bankruptcy can help those with very low incomes
Many people who have lost their job or have a very low income panic about how they will be able to repay their debts when they have no income. Those in this situation may be able to benefit significantly by filing for Chapter 7 bankruptcy because only those with a low-income relative to their debts are eligible to file.
Chapter 7 bankruptcy leverages assets to pay off debts
Chapter 7 bankruptcy is essentially a form of liquidation. The bankruptcy trustee is able to seize assets and sell them in order to pay off debts. This means that you may have to sacrifice your home, car and other assets in the process, but usually, this is seen to be worthwhile by debtors.
Chapter 7 bankruptcy filers benefit from a debtor’s discharge
Perhaps the most appealing aspect of any bankruptcy is the fact that debtors are able to benefit from a discharge at the end of the bankruptcy. This effectively means that you will be able the have your prior debts completely wiped out, regardless of whether you had sufficient assets in order to pay off debts. Thus, by going through Chapter 7 bankruptcy you will be able to gain a financial fresh start.
If you want to gain a fresh financial start and be free from debts, you should consider all options available to you. By taking a means test, you will be able to learn whether you will be eligible for Chapter 7 bankruptcy.