William H. Lively, Jr

Choosing the right type of personal bankruptcy

Many people in Texas are struggling with insurmountable debt burdens, annoying or harassing collection calls and difficult financial circumstances. They may be looking for an exit to a new financial future that can offer significant debt relief. People who are unable to pay their debts may turn to personal bankruptcy as a solution that helps them move forward with their lives. There are two major types of personal bankruptcy: Chapter 7 and Chapter 13. The right type of bankruptcy for each person may vary depending on financial circumstances, property ownership and other issues.

A Chapter 7 bankruptcy involves liquidating assets and selling them to pay off creditors in part. After the bankruptcy is completed, all eligible debts will be eliminated. Not all debts can be addressed in bankruptcy, including student loans and child support obligations. However, people must generally liquidate their property beyond the exceptions allowed under law. In addition, there is a means test to determine eligibility for Chapter 7 bankruptcy. Only people who make the median income in their state or below are eligible to file for this type of bankruptcy, making it unsuitable for high earners who also have unsustainable debts.

On the other hand, Chapter 13 bankruptcy does not have a means test. It takes much longer, from three to five years instead of three to five months. Rather than liquidating assets, it aims to reorganize a person's finances, making it a good choice for people who also have a second home or other valuable assets. During the bankruptcy, people must keep up with a payment plan.

People who are facing unrepayable debt might find that personal bankruptcy is the right solution for debt relief. An attorney may provide advice and guidance on Chapter 7 and Chapter 13 bankruptcy and how to move forward with filing.

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William H. Lively, Jr

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William H. Lively, Jr
432 S Bonner
Tyler, TX 75702

Phone: 903-920-0008
Phone: 903-593-3001
Fax: 903-595-3715
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