A full chapter 7 bankruptcy may be a bit too much. Firstly, chapter 7 is hard to approve as lenders and bank institutions have drastically tightened their standards and minimum requirements for meeting chapter 7 status.
The campaign against the prevalence of chapter 7 filings has opened up new doors for Americans. The option for chapter 13 bankruptcy has only become more appealing in the last few years. Chapter 13 allows clients to reorganize their liabilities alongside an Attorney in Tacoma WA. Payment will still be made to the lenders in some capacity, but it will be drastically reformed. The benefits for chapter 13 over 7 are extensive. An Attorney in Tacoma WA covers the three most rewarding benefits for reorganizing debt instead of ridding of it entirely.
Faster Recovery
There are ramifications to a chapter 7 that take about a decade to escape from. Chapter 13 manages to avoid almost all these issues. The greatest benefit to chapter 13 is that it does not fundamentally destroy a client’s credit and ability to purchase a home. Some people consider chapter 7 like a pause in their life. They can help build things back to the way they were before, but no real forward momentum will occur until they escape the bankruptcy’s long reach.
Avoiding Creditor Frustrations
The second great benefit to a chapter 13 is the handling of creditors. In both cases, creditors will be distraught. When the debt is being rid of entirely, the wrath of creditors can be overwhelming. Chapter 13 is closer to a middle ground, and cooperation goes a long way in keeping creditors mostly satisfied. Upset creditors have the potential to make life very difficult.
Avoiding Lawsuits
A lawsuit related to a chapter 13 filing is far less common than one related to a chapter 7. Creditors know that the debt is being whitewashed entirely, so they will fight for finances, and battle to stop the process. With chapter 13’s, the client is negotiating terms and open to specific payback plans. The creditor is more willing to negotiate without resorting to an expensive and dramatic lawsuit. These are just expectations, and every situation is different. Speak with a Tacoma attorney to learn more about the specific differences between the two methods.
