Debt is something with which far too many Tennessee residents are familiar. Most people have it; some just have more than others. Unfortunately, right now, regardless of how much debt they have, many are struggling to meet their debt obligations. Filing for bankruptcy may help improve their situations, but some are unsure of which type of bankruptcy they should pursue — Chapter 7 or Chapter 13.
There are between these two types of bankruptcy filings. Chapter 7 relief is for those who are looking for a complete and immediate discharge of debt. It is for those who can prove they lack the disposable income to pay back their creditors and who are not opposed to losing their nonexempt property. It is estimated that roughly 71% of all bankruptcy filings submitted each year are for this type of relief.
Chapter 13 is more involved. It is for individuals who do have enough disposable income to make payments to their creditors; they just may need some help making those payments more affordable. It requires setting up a payment schedule and sticking to it for three to five years before any debts qualify for discharge. It is for individuals who do not wish to give up their property.
Figuring out which type of bankruptcy one qualifies for is not too difficult. It really comes down to income level. Tennessee residents who would like more detailed information about the differences between bankruptcy, as well as a case review to determine for which type they qualify can turn to an experienced bankruptcy law attorney for guidance and assistance pursuing financial relief.