As the bills continue to arrive, decisions regarding which ones to pay must be made. Depending upon circumstances, the Pennsylvania resident must decide between either paying the mortgage or buying groceries. Sometimes the decision is whether to pay the car note or buy gas. When the debt burden becomes too much and one must make these kinds of decisions, relief can often be found through Chapter 7 bankruptcy.
Chapter 7 bankruptcy offers the individual the opportunity to discharge the majority, and sometimes all, of his or her debts. This means that the individual will no longer owe this debt and therefore will not be required to repay it. While not every individual who files for Chapter 7 bankruptcy relief is successful, research indicates that approximately 96 percent of those who choose this option have their debts successfully discharged.
One primary concern with this approach to financial relief is this type of bankruptcy calls for the individual's assets to be liquidated in order to pay a portion of the debts. However, there are thresholds indicating how much the individual is entitled to keep. The majority of the time, the individual's assets do not exceed this threshold, and the individual retains his or her assets. Additionally, it may be possible to retain certain items used to secure debt such as a home or car by continuing to pay on the mortgage or car note.
Many Pennsylvania residents find themselves facing financial struggles at one time or another. Most of the time, this is a temporary situation that will quickly be put to rest. However, when there does not appear to be an end in sight, filing for Chapter 7 bankruptcy may be the solution. Experienced legal counsel can help one decide if this is the best option.
Source: propublica.org, "Bankruptcy: What's the Difference Between Chapter 7 and Chapter 13?", Paul Kiel, Sept. 27, 2017