These days, many individuals are filing for bankruptcy to get rid of debts. However, filing for bankruptcy is not that easy, especially if you wish to get through the process on your own. It is always advisable to hire a reputed bankruptcy attorney who will decide whether you should file chapter 7 bankruptcy or chapter 13 bankruptcy Moreno valley.
Ever since the bankruptcy law was created, most of the people, who thought of bankruptcy, considered chapter 7 of the law to file for bankruptcy. Not a single person used to think about chapter 13 of the law while opting for bankruptcy. In fact, chapter 13 was considered to be the wicked sister of chapter 7 and nobody liked the chapter 13. However, things changed drastically after the crash of the real estate market in 2007.
During this year, many bankruptcy lawyers searched for alternatives to help people protect their houses from foreclosure. Initially, a lot of people tried chapter 7 of the law to avert foreclosure. While the chapter 7 helped these individuals in stopping foreclosure, it offered only a temporary relief as the lender was able to file for a motion for stay relief and proceed with the foreclosure procedure.
That is when bankruptcy lawyers became creative and looked for a solution for this kind of situation. A creative lawyer figured out that with the drastic fall in the prices of real state property, many houses had seconds or thirds along with the real estate being valued at much less than what was actually owed on the first. Taking note of this point, bankruptcy attorneys filed a motion in the court to move the lien on the second and third, thereby making the debt unsecured and no longer a priority to be paid in chapter 13 of the bankruptcy law.
Since debts are repaid by priority under chapter 13 with secured debts as the top priority and unsecured debts getting whatever is left over, individuals opting for bankruptcy would only be needed to clear the first payee (which is secured) and also reduce the balance owed on their house. For some individuals, this came as a blessing in disguise. These individuals were able to stop foreclosure and even keep their home.
Another important advantage of chapter 13 is the flexibility of the procedure. The court acknowledges that things could change considerably over the five year time frame that the bankruptcy filing takes. As a result, the court allows a bankruptcy lawyer to send a plan changes (modifications) to the bankruptcy trustee for approval. Some changes might be temporary, while certain changes could be permanent. In case the situation of a person changes and he is unable to make payment under chapter 13, he can switch to chapter 7 procedure.
Thus, there are many benefits of chapter 13 over chapter 7 bankruptcy. This is why filing for bankruptcy under chapter 13 is a better choice. However, you should hire a competent and well experienced attorney to derive maximum advantages of chapter 13. A reliable lawyer will work to his best potential and help you to get through the hassles of the bankruptcy process with minimum problems and in much less time.
Going through the undesirable procedure of bankruptcy is certainly not easy. Even so, you may get through this undesirable stage of your life by turning to a reliable bankruptcy lawyer. An ideal lawyer will figure out whether you must file chapter 7 or chapter 13 bankruptcy Moreno valley. Moreover, a competent attorney will let you know the benefits of chapter 13 over chapter 7 and help you get through the tedious process of bankruptcy. On account of these reasons, it is always preferable to hire the expertise of a reputed bankruptcy attorneys to derive maximum benefits of chapter 13 bankruptcy.