Many people are judgmental of those who have to file for bankruptcy, but the truth is that it often happens because of circumstances that are beyond the filer’s control. For example, maybe this individual was in the hospital with an extended illness that kept him or her out of work for several months and is now in a situation where filing bankruptcy is the only option. It is important to try to be empathetic to people who go through this type of situation.

If you are dealing with this situation, it might be a good idea for you to work with a bankruptcy lawyer. Many people do not understand exactly how bankruptcy works, and a lawyer can guide them through the process. The attorney will be able to explain how a chapter 7 bankruptcy works, what active bankruptcies can do for people, the advantages of chapter 13 over chapter 7, and the effect that all types of bankruptcies can have, as well as many more concepts that might be relevant. It is better that you understand exactly how bankruptcy works, particularly the type of bankruptcy that you are filing. This way, you are more likely to be able to provide the right information and be successful in your case.

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If you’re one of the many Americans struggling with finances, you may be considering bankruptcy as an option. Of course, there are many different types of bankruptcy and even many alternatives to bankruptcy completely, but Chapter 13 and Chapter 7 bankruptcy are the most common types for American homeowners. So what is bankruptcy anyway?

  • First of all, it’s important to understand what bankruptcy is, in its most general form. This is a legal procedure which many Americans struggling with finances — an estimated 1.1 million households each year, actually — choose to do. By consolidating and erasing payments, bankruptcy lawyers can stop the harassing phone calls from creditors, which is the biggest relief for many people. It’s important to note that there are consequences, however, and not all types of debt are erased.


  • Chapter 13 bankruptcy and Chapter 7 bankruptcy are the most common types in the U.S. Chapter 7 is considered liquidation bankruptcy, while Chapter 13 involves a payment plan over a three- to five-year period. There are advantages (and disadvantages) for both types, and it depends on the financial situation of each individual to determine which type is best.


  • Many types of loans and payment plans can be worked into the bankruptcy process. Filing for bankruptcy doesn’t mean that all of your existing payments will disappear, but it does mean that they will be easier to handle. Your credit score will drop after filing for bankruptcy, but the good news is that it won’t stay at a low score forever. It may take a few years to build up a new score, but it certainly is possible, and many people have done it.

If you aren’t sure whether bankruptcy is a good idea for you, the best thing to do is to find a local law firm with good bankruptcy lawyers who can help you understand what the process entails. A good bankruptcy attorney will help you decide which type of bankruptcy is best for you — if bankruptcy is a good idea at all — and will give you advice that caters to your own individual situation. Remember, the best bankruptcy attorney for someone else may not be the best one for you, because everyone’s case is different. Many lawyers choose to specialize in different types of bankruptcy cases, so it’s also important to remember that a Chapter 13 bankruptcy attorney may not be completely knowledgeable about Chapter 7 cases, and vice versa. It is not always possible to avoid foreclosure and bankruptcy, but if you find yourself struggling, just remember that there are many resources available that can help.
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