For most people, filing for bankruptcy is a long, difficult process that takes place during a complicated time in their lives. The first step is determining which type of bankruptcy to file for. The attorneys of Cecil & Cecil, PA in High Point, NC, put together everything you need to know about Chapter 7 and Chapter 13 bankruptcy.

Chapter 7 Bankruptcy

Also known as “straight bankruptcy,” Chapter 7 bankruptcy is simple and quick compared to Chapter 13 bankruptcy. As the most common type of bankruptcy filed in the United States, it is mainly used to erase credit card debt or medical bills and is only available to people who earn less than a certain income level. Individuals and businesses can file under Chapter 7, which can only be filed one time in your life. You may have to sell your house or car to satisfy creditors.

Chapter 13 Bankruptcy

Also known as “wage earner bankruptcy,” Chapter 13 bankruptcy must be used if you make more than a certain amount of money. Through this plan, you will pay back most of your debt through a court-ordered repayment plan stretched across three to five years. It also differs from Chapter 7 in that you get to keep your assets and you can file more than once in your life. Only individuals can file for Chapter 13.

Under both types of bankruptcy, there are certain types of debts that will never be erased. These include debts from child support, alimony, student loans, and criminal fines.

If you need legal advice regarding your financial situation, the attorneys at Cecil & Cecil PA will get you back on your feet. Call (336) 883-8383 to schedule a consultation with the law firm, or visit their website to learn more about how they’ll help you.