The end product to filing for bankruptcy is often financial freedom. Many Long Islanders use bankruptcy as a way to overcome their burdensome medical, credit card, and other debts. In its various forms, bankruptcy offers individuals and businesses different ways to pull themselves out of stresses that come with unpayable economic liabilities.
However, it is important to remember that bankruptcy is not easy and that imposes significant burdens on those who choose to utilize its protections. Under individual forms of bankruptcy, those burdens can be varied. This post will explore some of the challenges that filers may face if they choose to pursue Chapter 13 bankruptcy.
First, it can take a long time to complete a Chapter 13 bankruptcy. In some cases, the process can last up to five years. Not all filers may be comfortable with such a long timeline for financial recovery.
Second, Chapter 13 bankruptcy requires that a person put all of his extra income toward paying off debts. This means that there is often no money left over for the debtor to use for enjoyment once he has paid for his life necessities and made manageable payments to his creditors.
Third, like other forms of bankruptcy, a Chapter 13 filing can stay on a person’s credit report for a decade. That means that for ten years after filing the filer may struggle to obtain credit, loans, and other money-based benefits due to the bankruptcy inclusion on his credit report.
The prior burdens are only a few of the issues Chapter 13 filers have to deal with after the complete their bankruptcy processes. Despite these challenges, many people still choose to use bankruptcy to get themselves out of heavy personal debts. Individuals who need assistance weighing to benefits and burdens of Chapter 13 bankruptcy may contact bankruptcy attorneys to discuss if the process is right for them.