Most people do not realize that there are actually five different types of bankruptcy. Most of time when someone hears the word “bankruptcy” they assume you are talking about Chapter 7 bankruptcy the one where you eliminate your debts and possible lose all your assets. The majority of bankruptcy cases filed are this kind of bankruptcy. Since the last major changes to the US Bankruptcy Code in 2005 the kind of bankruptcy where you pay back yours debts has grown in popularity. This type of bankruptcy where you pay back your debt is called “Chapter 13” bankruptcy. The increased use in this type of bankruptcy is due to a number of factors – mostly due to the design changes of the bankruptcy code that forced a relatively significant portion of the population to only be eligible for this kind of bankruptcy.
In my Utah County bankruptcy office, located in Orem, Utah, we file a ever more significant number of these Chapter 13 cases each year. Many times they are the best option for our clients since it allows them to keep their significant assets like the home or the car. Sometimes it is because there is a strategic advantage to file a Chapter 13 case since a creditor may be hounding them to the point that their home may be lost due to a large judgment lien about to be placed on the property. Other times clients want to actually pay back what they barrowed but the creditor has taken such a hard line position that they have no other choice but to force the creditor to the bankruptcy table and force a work out of the debt with oversight of a Judge and Trustee. Still some people need to file a Chapter 13 case since it has been less that eight years since the filed a Chapter 7 bankruptcy and they have no other option but to seek the protection of the bankruptcy court in the form of a Chapter 13 bankruptcy. Chapter 13 is the bankruptcy where you pay back your debts.
Which type of bankruptcy is right for you? Looking of the bankruptcy where you pay back? An experienced Utah lawyer can help guild through the many choices out there. Call The Bankruptcy Guy now to set up your in office consultation 801-221-9911.