When you’re faced with the need for debt relief, you have a number of options to choose from. Chapter 13 bankruptcy is a common solution that offers debtors a gradual repayment plan. If you’re wondering how this works, and if it is right for you, learn more about this type of bankruptcy with these frequently asked questions.

What You Should Know About Chapter 13 Bankruptcy

How long is the process?

While every circumstance is different, Chapter 13 payment plans usually last between three and five years. This gives debtors a longer amount of time to space out smaller payments they can reasonably afford. The record of your bankruptcy will remain on your credit report for seven years from the filing date.

What are the benefits of filing for Chapter 13 bankruptcy?

Although Chapter 7 bankruptcy wipes out your debts and leaves you with a clean slate, it’s not the superior option for every debtor. Because it leaves debts unpaid, you’ll be left with a much poorer credit score, and the record will remain on your report for 10 years.

With Chapter 13 bankruptcy, you have a chance to prove yourself to your creditors, and because you made an effort to fulfill your promise of payment, your credit score will be impacted less. Also, Chapter 13 allows you to hold onto your property—in Chapter 7, your car or house will be sold to cover discharged debts.

What debts are involved?

Under Chapter 13 bankruptcy, you’ll only have to pay back a portion of unsecured debts like credit card balances. You’ll still have to pay secured debt and priority debt in full, such as child support, back taxes, and debts involving collateral, like missed car or real estate payments. In the majority of cases, student loan debt can’t be discharged and must, eventually, be paid in full.

Will Chapter 13 stop creditors from calling?

If you’ve been receiving constant calls, emails, or letters from those you owe money to, you can take advantage of Chapter 13 bankruptcy’s “automatic stay” rule. This means, as soon as you submit your documents and pay a filing fee, creditors must stop all attempts to contact or track you down.

If you’re interested in pursuing Chapter 13 bankruptcy, contact Harry B. Zornow in Hamilton, OH. This attorney has over 30 years of experience helping clients obtain a clean financial slate, whether through Chapter 7, 13, or other debt relief options. If you’re tired of being hassled by creditors, Attorney Zornow will help you cut through the noise and take control of the situation. To learn more about his bankruptcy services, visit the website. You can also call (513) 737-9770 to schedule a free consultation and start planning your future.