Chapter 7 Bankruptcy Processes in Harrisburg, PA
Chapter 7 bankruptcy is a liquidation bankruptcy that allows individuals to discharge most of their debts by selling non-exempt assets.
- Non-exempt assets are sold at a trustee's sale, and the proceeds go towards paying creditors' claims.
- Credits can be discharged for non-dischargeable debt types like taxes, student loans, and personal loans.
- Chapter 7 bankruptcy has a six-month waiting period before it can be filed.
Chapter 13 Bankruptcy Processes in Harrisburg, PA
Chapter 13 bankruptcy is a reorganization bankruptcy that allows individuals to create a payment plan to repay part or all of their debts.
- Creditors must approve the payment plan before it can be filed.
- Debt payments are made over three to five years, with regular progress reports due to the court.
- Chapter 13 bankruptcy has a two-year waiting period before it can be filed.
Benefits of Chapter 7 and Chapter 13 Bankruptcies
Chapter 7 bankruptcy provides relief from creditor harassment, wage garnishment, and foreclosure.
- Creditor liability is limited in Chapter 7 bankruptcy, making it less intimidating for individuals with multiple creditors.
- A Chapter 13 payment plan can provide a temporary solution to debt repayment, helping individuals avoid default and stay in their home.