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The basics of straight bankruptcy and what it can do

This blog frequently discusses the different types of bankruptcy and what different bankruptcy options can do for struggling consumers, homeowners, businesses and others. Chapter 7 bankruptcy, commonly referred to as straight bankruptcy, is a bankruptcy option anyone considering bankruptcy should be familiar with when determining which bankruptcy option is best for them.

Chapter 7 bankruptcy is a process that allows the filing party to discharge most of their debts and can be helpful with unsecured debt such as medical debt and credit card debt. Chapter 7 bankruptcy can also be effective at helping the filing party with creditor harassment, wage garnishment, repossession, foreclosure and other concerns they may have related to overwhelming debt.

The filing party can expect a temporary stay of creditor collection actions once they have filed for bankruptcy, followed by a 4-month bankruptcy process with a debt discharge at the end. In some circumstances, debt relief on unsecured debt can allow the filing party the time and source of funds to be able to catch up on secured debts. In its most simple terms, Chapter 7 bankruptcy allows the filing party to liquidate non-exempt assets to repay credits and enjoy debt relief. For those considering bankruptcy and debt relief options, they should also understand how to qualify for different types of bankruptcy protection.

The range of bankruptcy options are important for struggling consumers and others to be familiar with. Understanding how the different bankruptcy options work, and which is best for the filing party, is also valuable information to have when contemplating the best option to enjoy a fresh financial start.

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