When a person is financially overwhelmed by their debts, they may have many different choices for trying to get themselves back on solid ground financially. Depending on the situation, one choice they may have is to pursue a Chapter 7 bankruptcy. There are certain requirements a person has to meet in order to be eligible for this form of bankruptcy protection.
As with any type of debt relief, Chapter 7 bankruptcy has both its potential upsides and its potential downsides.
One of the bigger upsides this form of bankruptcy can have is that it can result in a discharge of many types of unsecured debt. Given the big financial toll high amounts of unsecured debt, like high credit card debt, can take on a person, being able to get such debts discharged can be a great relief to a person.
On the opposite end of the spectrum, one of the more significant downsides Chapter 7 can have is that a person can end up losing property in it. Certain property could end up being liquidated in order to pay creditors. The amount of property loss a person could face in a Chapter 7 bankruptcy can vary quite a bit based on things like: the types of debt they have, the kinds of property they have and their state’s bankruptcy property exemption rules. Consequently, some individuals could face substantial property losses in a Chapter 7 bankruptcy, while others could face little to no such losses.
Thus, whether or not they would qualify for Chapter 7 bankruptcy protection is not the only important thing for a person to consider when they are deciding whether to pursue this type of bankruptcy. It is also important to consider things like how big of benefits one would likely get from the upsides of this bankruptcy type, how big of downsides they would likely be exposed to, and how the benefits ultimately compare to the downsides.
Our firm can help individuals who are facing difficulties from mounting debt with figuring out whether Chapter 7 bankruptcy would be a worthwhile debt relief avenue for them. We are very knowledgeable about Chapter 7 bankruptcy law and the specifics of the Chapter 7 bankruptcy process here in Mississippi and can provide individuals with straightforward assessments of their eligibility for this form of bankruptcy relief and what particular upsides and downsides they could experience from this bankruptcy type.