We have a lot of bad credit card debt because of being unemployed, we also own rental properties which we own money on. I'm just frustrated and trying to figure out what to do.
2007-03-19 11:34:20 · 4 answers · asked by Pamela P 1 in Business & Finance ➔ Credit
Bankruptcy laws have changed so I am not as familiar with the exact criteria to qualify now but can tell you that of the two, I would do Chapter 7. The reason is both damage your credit the same yet the Chapter 13 you have to pay back. There is no logical reason to do the 13 that I am aware of. If you are going to do it and qualify, then dump the whole mess in a Chapter 7 and don't look back. You can then rebuild your credit faster than you think and faster than with all the reorganized debt from a 13 hanging over your head continuing to beat you up every month for no gain. I assume you have have explored options such as selling the rental property(s) that have equity or negative cash flow and solving your some of your problems that way. I am not the end all credit expert but have worked as a banker for 16 years and have dealt with this 100's of times and these are my observations. Do the 7 if you have to do one. Good luck to you!
2007-03-19 12:23:32 · answer #1 · answered by Charlie 2 · 0⤊ 0⤋
I would got for Chapter 7 only..............
Chapter 7 bankruptcy is the commonest denotation of bankruptcy. It stands for waiving or canceling of debts that you have incurred. As an individual, you can select between Chapter 13 or Chapter 7 bankruptcy. Selecting between the two is not easy. The bankruptcy court will study your circumstances before deciding which type of bankruptcy is applicable to you.
The Chapter 7 bankruptcy is applicable if you have no regular sources of income. It works by reducing or clearing off all your debts. You can then make a fresh start without having to worry about having to pay your debts.
Once you file for Chapter 7 bankruptcy, the bankruptcy court assigns a trustee who works as an intermediary between you and the debtors. He oversees everything and checks out if the bankruptcy plan is going as planned.
2007-03-20 00:33:01 · answer #2 · answered by mey t 2 · 0⤊ 0⤋
I have owned rental properties before and had to claim bankruptcy. If you want to keep the houses, you want to claim chapter 13. If you want to get rid of everything, claim chapter 7. If you have equity in those homes and make money off of them, I would keep them.
2007-03-19 12:13:15 · answer #3 · answered by Anonymous · 0⤊ 0⤋
ch13 u make payments every month. ch7 you don't make payments. they will take the rental properties from you.
2007-03-19 11:45:25 · answer #4 · answered by cmruffin1 2 · 0⤊ 0⤋