Personal bankruptcy protections are an important resource for struggling consumers and homeowners worried about losing their home to foreclosure to be familiar with. Chapter 13 bankruptcy protection is a reorganization bankruptcy process that allows struggling consumers who qualify to reorganize their debts and repay it over a specified period of time.
How can chapter 13 personal bankruptcy protection help struggling consumers?
Chapter 13 personal bankruptcy can help struggling consumers reorganize their debt so that they can repay it over time. Once the filing party has fulfilled their obligations according to the repayment plan worked out with the bankruptcy court, they will receive a debt discharge. Chapter 13 bankruptcy can help with medical debts, credit card debts and other debts consumers may be facing.
How can Chapter 13 personal bankruptcy protection help struggling homeowners?
One important advantage of any personal bankruptcy protection option is that once the bankruptcy petition is filed, an automatic stay goes into effect which prevents creditor collections actions during the bankruptcy process. In addition to giving struggling consumers some much-needed breathing room, this may be able to help a struggling homeowner facing foreclosure stay in their home. The past-due mortgage payments may be included in the repayment plan, allowing the homeowner to repay them over a reasonable period of time and avoid losing their home.
Different personal bankruptcy protections are available to consumers in different situations which is why any consumer who is struggling with overwhelming debt, or homeowner who is dealing with the stress and anxiety of potentially losing their home, should be familiar with how those options can help. Chapter 13 bankruptcy may be able to provide important protections to consumers and a fresh financial start.