In Texas, bankruptcy claims provide the opportunity to settle debts. The processes require either a repayment plan that lasts up to five years or liquidation. For consumers to qualify for a repayment plan through chapter 13, they must meet income requirements. If the consumer doesn’t qualify for chapter 13, they can file for bankruptcy through chapter 7 only. Chapter 7 bankruptcy in Fort Worth can provide debt settlement opportunities for consumers.
A Review of the Consumer’s Assets
The court reviews the consumer’s assets to determine if the assets can generate enough proceeds to pay off the consumer’s debts. The court reviews the procedures required for selling the assets and determine if it is feasible according to bankruptcy guidelines.
Credit Counseling Programs
Before the consumer can start their bankruptcy claim, they must attend a state-approved credit counseling program. The program shows them how to manage their finances better and avoid overwhelming debt in the future. They also learn how to pay off debts quickly without incurring late charges and negative listings on their credit report. The strategies are presented to help the consumer rebuild their credit after they file for bankruptcy.
Starting the Liquidation Process
The liquidations process starts with the sale of all assets. They are sold through a real estate transaction, auction, and through quick sales. The trustee assigned to the claim collects all proceeds after each sale. The funds are distributed to all creditors to pay off the debt.
What Can the Consumer Expect
The consumer cannot start any new lines of credit or purchase any new assets during the bankruptcy. They will receive an exempted value for certain assets. The bankruptcy can remain on their credit history for up to ten years, which could present them with some difficulties in the future.
In Texas, chapter 7 is often used as an alternative to chapter 13; it provides the same protection as chapter 13. However, it is completed in under six months. The process requires the sale of assets to pay off debts quickly. Consumers who want to start a claim for chapter 7 bankruptcy in Fort Worth can visit our website for more details now.