{"id":3771,"date":"2021-09-06T09:00:32","date_gmt":"2021-09-06T09:00:32","guid":{"rendered":"https:\/\/phoenixfreshstartbankruptcy.com\/?p=3771"},"modified":"2022-04-29T08:51:35","modified_gmt":"2022-04-29T08:51:35","slug":"the-different-types-of-debts-and-bankruptcies","status":"publish","type":"post","link":"https:\/\/phoenixfreshstartbankruptcy.com\/the-different-types-of-debts-and-bankruptcies\/","title":{"rendered":"The Different Types of Debts and Bankruptcies"},"content":{"rendered":"<p><a href=\"https:\/\/phoenixfreshstartbankruptcy.com\/wp-content\/uploads\/2021\/09\/Chapter-7-vs-Chapter-13.webp\"><img decoding=\"async\" class=\"aligncenter wp-image-3773\" title=\"Chapter 7 vs Chapter 13\" src=\"https:\/\/phoenixfreshstartbankruptcy.com\/wp-content\/uploads\/2021\/09\/Chapter-7-vs-Chapter-13.webp\" alt=\"Chapter 7 vs Chapter 13\" width=\"700\" height=\"467\" srcset=\"https:\/\/phoenixfreshstartbankruptcy.com\/wp-content\/uploads\/2021\/09\/Chapter-7-vs-Chapter-13-200x133.webp 200w, https:\/\/phoenixfreshstartbankruptcy.com\/wp-content\/uploads\/2021\/09\/Chapter-7-vs-Chapter-13-300x200.webp 300w, https:\/\/phoenixfreshstartbankruptcy.com\/wp-content\/uploads\/2021\/09\/Chapter-7-vs-Chapter-13-400x267.webp 400w, https:\/\/phoenixfreshstartbankruptcy.com\/wp-content\/uploads\/2021\/09\/Chapter-7-vs-Chapter-13-450x300.webp 450w, https:\/\/phoenixfreshstartbankruptcy.com\/wp-content\/uploads\/2021\/09\/Chapter-7-vs-Chapter-13-600x400.webp 600w, https:\/\/phoenixfreshstartbankruptcy.com\/wp-content\/uploads\/2021\/09\/Chapter-7-vs-Chapter-13-768x512.webp 768w, https:\/\/phoenixfreshstartbankruptcy.com\/wp-content\/uploads\/2021\/09\/Chapter-7-vs-Chapter-13-800x534.webp 800w, https:\/\/phoenixfreshstartbankruptcy.com\/wp-content\/uploads\/2021\/09\/Chapter-7-vs-Chapter-13.webp 1024w\" sizes=\"(max-width: 700px) 100vw, 700px\" \/><\/a><\/p>\n<p><span style=\"font-weight: 400;\">Very broadly, a bankruptcy filing can help repay their debts. Additionally, it can help with debt settlement since the bankruptcy discharge can help <\/span><b>wipe out<\/b><span style=\"font-weight: 400;\"> certain unpaid debts after bankruptcy is filed. The bankruptcy protection provided by the <\/span><a href=\"https:\/\/phoenixfreshstartbankruptcy.com\/bankruptcy-automatic-stay\/\"><b>automatic stay<\/b><\/a><span style=\"font-weight: 400;\"> is also beneficial when dealing with debt problems and debt collectors.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">People <\/span><b>struggling with debt<\/b><span style=\"font-weight: 400;\"> often look into filing for bankruptcy. However, solving financial problems through a bankruptcy case can be very difficult without any legal help. If you wish to learn more about how to file a petition in bankruptcy, it is advisable to consult early on with a trusted <\/span><a href=\"https:\/\/phoenixfreshstartbankruptcy.com\/\"><span style=\"font-weight: 400;\">Phoenix bankruptcy attorney<\/span><\/a><span style=\"font-weight: 400;\">.\u00a0<\/span><\/p>\n<p>&nbsp;<\/p>\n<h2><span class=\"ez-toc-section\" id=\"Different_Types_of_Debt\"><\/span><strong>Different Types of Debt<\/strong><span class=\"ez-toc-section-end\"><\/span><\/h2><div id=\"ez-toc-container\" class=\"ez-toc-v2_0_65 counter-hierarchy ez-toc-counter ez-toc-grey ez-toc-container-direction\">\n<label for=\"ez-toc-cssicon-toggle-item-663ca05d1f658\" class=\"ez-toc-cssicon-toggle-label\"><span class=\"\"><span class=\"eztoc-hide\" style=\"display:none;\">Toggle<\/span><span class=\"ez-toc-icon-toggle-span\"><svg style=\"fill: #999;color:#999\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" class=\"list-377408\" width=\"20px\" height=\"20px\" viewBox=\"0 0 24 24\" fill=\"none\"><path d=\"M6 6H4v2h2V6zm14 0H8v2h12V6zM4 11h2v2H4v-2zm16 0H8v2h12v-2zM4 16h2v2H4v-2zm16 0H8v2h12v-2z\" fill=\"currentColor\"><\/path><\/svg><svg style=\"fill: #999;color:#999\" class=\"arrow-unsorted-368013\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" width=\"10px\" height=\"10px\" viewBox=\"0 0 24 24\" version=\"1.2\" baseProfile=\"tiny\"><path d=\"M18.2 9.3l-6.2-6.3-6.2 6.3c-.2.2-.3.4-.3.7s.1.5.3.7c.2.2.4.3.7.3h11c.3 0 .5-.1.7-.3.2-.2.3-.5.3-.7s-.1-.5-.3-.7zM5.8 14.7l6.2 6.3 6.2-6.3c.2-.2.3-.5.3-.7s-.1-.5-.3-.7c-.2-.2-.4-.3-.7-.3h-11c-.3 0-.5.1-.7.3-.2.2-.3.5-.3.7s.1.5.3.7z\"\/><\/svg><\/span><\/span><\/label><input type=\"checkbox\"  id=\"ez-toc-cssicon-toggle-item-663ca05d1f658\"  aria-label=\"Toggle\" \/><nav><ul class='ez-toc-list ez-toc-list-level-1 ' ><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-1\" href=\"https:\/\/phoenixfreshstartbankruptcy.com\/the-different-types-of-debts-and-bankruptcies\/#Different_Types_of_Debt\" title=\"Different Types of Debt\">Different Types of Debt<\/a><ul class='ez-toc-list-level-3' ><li class='ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-2\" href=\"https:\/\/phoenixfreshstartbankruptcy.com\/the-different-types-of-debts-and-bankruptcies\/#Secured_Debts\" title=\"Secured Debts\">Secured Debts<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-3\" href=\"https:\/\/phoenixfreshstartbankruptcy.com\/the-different-types-of-debts-and-bankruptcies\/#Unsecured_Debts\" title=\"Unsecured Debts\">Unsecured Debts<\/a><\/li><\/ul><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-4\" href=\"https:\/\/phoenixfreshstartbankruptcy.com\/the-different-types-of-debts-and-bankruptcies\/#The_Different_Types_of_Bankruptcy\" title=\"The Different Types of Bankruptcy\">The Different Types of Bankruptcy<\/a><ul class='ez-toc-list-level-3' ><li class='ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-5\" href=\"https:\/\/phoenixfreshstartbankruptcy.com\/the-different-types-of-debts-and-bankruptcies\/#Chapter_7_Bankruptcy\" title=\"Chapter 7 Bankruptcy\">Chapter 7 Bankruptcy<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-6\" href=\"https:\/\/phoenixfreshstartbankruptcy.com\/the-different-types-of-debts-and-bankruptcies\/#Chapter_13_Bankuptcy\" title=\"Chapter 13 Bankuptcy\">Chapter 13 Bankuptcy<\/a><\/li><\/ul><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-7\" href=\"https:\/\/phoenixfreshstartbankruptcy.com\/the-different-types-of-debts-and-bankruptcies\/#How_Long_a_Bankruptcy_Can_Stay_on_Your_Credit_Report\" title=\"How Long a Bankruptcy Can Stay on Your Credit Report\">How Long a Bankruptcy Can Stay on Your Credit Report<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-8\" href=\"https:\/\/phoenixfreshstartbankruptcy.com\/the-different-types-of-debts-and-bankruptcies\/#Consult_with_an_Experienced_Phoenix_Bankruptcy_Attorney_Today\" title=\"Consult with an Experienced Phoenix Bankruptcy Attorney Today!\">Consult with an Experienced Phoenix Bankruptcy Attorney Today!<\/a><\/li><\/ul><\/nav><\/div>\n\n<p><span style=\"font-weight: 400;\">A bankrupt individual should first get preliminary information on the basics of the bankruptcy code. Under relevant bankruptcy laws, filers must first take and pass a <\/span><a href=\"https:\/\/www.justice.gov\/ust\/means-testing\" target=\"_blank\" rel=\"noopener\"><b>means test<\/b><\/a><b>.<\/b><span style=\"font-weight: 400;\"> Essentially, your eligibility to file bankruptcy will be based on your monthly income, living expenses, and other pertinent information in the paperwork that you will submit. The bankruptcy court will look if you meet certain qualifications before they process and, hopefully, approve your bankruptcy petition.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">When you file for bankruptcy, you must be aware that the debts you need to pay off are not treated the same way. They will likely be tagged as either a secured debt or an unsecured debt.<\/span><\/p>\n<p>&nbsp;<\/p>\n<h3><span class=\"ez-toc-section\" id=\"Secured_Debts\"><\/span><strong>Secured Debts<\/strong><span class=\"ez-toc-section-end\"><\/span><\/h3>\n<p><b>Secured debts<\/b><span style=\"font-weight: 400;\">, for one, are those that involve collateral. Home and car loans are the most common examples of secured debts. A debtor who fails to pay these will potentially lose their real or personal property, such as your home or car. To save your assets, you must prioritize paying these types of debts. Experienced Phoenix bankruptcy lawyers can explain this in more detail.<\/span><\/p>\n<p>&nbsp;<\/p>\n<h3><span class=\"ez-toc-section\" id=\"Unsecured_Debts\"><\/span><strong>Unsecured Debts<\/strong><span class=\"ez-toc-section-end\"><\/span><\/h3>\n<p><span style=\"font-weight: 400;\">Meanwhile, when it comes to <\/span><b>unsecured debts<\/b><span style=\"font-weight: 400;\">, the creditor only holds into the commitment of the debtor to pay all that is owed. This typically includes credit card bills and medical bills.\u00a0<\/span><\/p>\n<p><span style=\"font-weight: 400;\">Financially overwhelmed debtors rarely pay back unsecured debts, and these can generally be <a href=\"https:\/\/phoenixfreshstartbankruptcy.com\/obtaining-debt-relief-through-chapter-7-and-chapter-13-bankruptcy\/\">wiped out when filing bankruptcy<\/a>. However, it is essential to keep in mind that although child support, alimony, and tax debt are also &#8216;unsecured,\u2019 failure to pay these may result in wage garnishment, and the government may even seize your bank account.<\/span><\/p>\n<p>&nbsp;<\/p>\n<h2><span class=\"ez-toc-section\" id=\"The_Different_Types_of_Bankruptcy\"><\/span><strong>The Different Types of Bankruptcy<\/strong><span class=\"ez-toc-section-end\"><\/span><\/h2>\n<p><span style=\"font-weight: 400;\">The bankruptcy process can be challenging to comprehend, especially without legal help. When filing a bankruptcy petition, the chapter you will choose will also depend on your current circumstance and whether or not you meet the qualifications,, and whether you can fulfill a <\/span><b>payment plan<\/b><span style=\"font-weight: 400;\">.\u00a0<\/span><\/p>\n<p><span style=\"font-weight: 400;\">The two common types of consumer bankruptcy (in contrast to business bankruptcy) are Chapter 7 and 13.<\/span><\/p>\n<p>&nbsp;<\/p>\n<h3><span class=\"ez-toc-section\" id=\"Chapter_7_Bankruptcy\"><\/span><strong>Chapter 7 Bankruptcy<\/strong><span class=\"ez-toc-section-end\"><\/span><\/h3>\n<p><a href=\"https:\/\/phoenixfreshstartbankruptcy.com\/chapter-7\/\"><span style=\"font-weight: 400;\">Bankruptcy filings under Chapter 7<\/span><\/a><span style=\"font-weight: 400;\"> are generally called liquidation bankruptcy. Under this bankruptcy form, the court can discharge your unsecured debt in a period of three to six months. When filing Chapter 7, your trustee will liquidate your assets and use the funds to pay debt collectors. This is one of the most crucial roles of a trustee in bankruptcy cases: managing the sales, distributing proceeds, and ensuring no interaction between the debtor and any lender involved. This will help avoid problems and mistakes within the bankruptcy proceeding.<\/span><\/p>\n<p>&nbsp;<\/p>\n<h3><span class=\"ez-toc-section\" id=\"Chapter_13_Bankuptcy\"><\/span><strong>Chapter 13 Bankuptcy<\/strong><span class=\"ez-toc-section-end\"><\/span><\/h3>\n<p><span style=\"font-weight: 400;\">On the other hand, <\/span><a href=\"https:\/\/phoenixfreshstartbankruptcy.com\/chapter-13\/\"><span style=\"font-weight: 400;\">bankruptcy proceedings under Chapter 13<\/span><\/a><span style=\"font-weight: 400;\"> are often called a reorganization bankruptcy. If you have not been to pay secured debts but want to keep your properties, filing for bankruptcy under Chapter 13 could be the best option. This will help you stop foreclosure and wage garnishment. In this bankruptcy chapter, you shall reorganize your finances and negotiate for a debt repayment plan. Your bankruptcy trustee will process your payments to your creditors. This bankruptcy chapter usually lasts for three or five years. A Chapter 13 bankruptcy will eliminate any outstanding debt after you complete the repayment plan.<\/span><\/p>\n<p>&nbsp;<\/p>\n<h2><span class=\"ez-toc-section\" id=\"How_Long_a_Bankruptcy_Can_Stay_on_Your_Credit_Report\"><\/span><strong>How Long a Bankruptcy Can Stay on Your Credit Report<\/strong><span class=\"ez-toc-section-end\"><\/span><\/h2>\n<p><span style=\"font-weight: 400;\">It is essential to consider all your options before you decide to file for bankruptcy since it is <a href=\"https:\/\/phoenixfreshstartbankruptcy.com\/bankruptcy-improve-credit-score\/\">a significant legal decision with certain consequences<\/a>.\u00a0<\/span><\/p>\n<p><span style=\"font-weight: 400;\">A Chapter 7 bankruptcy, for instance, can stay on your credit report for up to <\/span><b>10 years from the date of filing<\/b><span style=\"font-weight: 400;\">. This can bring about a negative impact on your ability to get credit. While you may still be able to take out a mortgage loan or open a credit card, you might have to pay a higher interest rate.<\/span><\/p>\n<p><span style=\"font-weight: 400;\">A completed Chapter 13 bankruptcy, meanwhile, can stay on your credit reports for up to <\/span><b>7 years from the filing date<\/b><span style=\"font-weight: 400;\">. However, certain creditors can look at a Chapter 13 bankruptcy more favorably than a Chapter 7 bankruptcy. It could be an indication that you repaid more of your debt.<\/span><\/p>\n<p>&nbsp;<\/p>\n<h2><span class=\"ez-toc-section\" id=\"Consult_with_an_Experienced_Phoenix_Bankruptcy_Attorney_Today\"><\/span><strong>Consult with an Experienced Phoenix Bankruptcy Attorney Today!<\/strong><span class=\"ez-toc-section-end\"><\/span><\/h2>\n<p><span style=\"font-weight: 400;\">Effectively dealing with debt is not easy. Choosing the<\/span><a href=\"https:\/\/phoenixfreshstartbankruptcy.com\/best-phoenix-bankruptcy-attorneys\/forms-of-bankruptcy\/\"> <b>best bankruptcy chapter<\/b><\/a><span style=\"font-weight: 400;\"> to file is necessary. To do so, you must first understand how debt relief works. Consult with an experienced Phoenix bankruptcy lawyer who can help you secure your financial future. Call our <\/span><a href=\"https:\/\/phoenixfreshstartbankruptcy.com\/contact\/\"><span style=\"font-weight: 400;\">Arizona bankruptcy law firm<\/span><\/a><span style=\"font-weight: 400;\">, Phoenix Fresh Start, for legal help and assistance.<\/span><\/p>\n","protected":false},"excerpt":{"rendered":"<p>Very broadly, a bankruptcy filing can help repay their debts. Additionally, it can help with debt settlement since the bankruptcy discharge can help wipe out certain unpaid debts after bankruptcy is filed. The bankruptcy protection provided by the automatic stay is also beneficial when dealing with debt problems and debt collectors. People struggling with debt often look into filing for bankruptcy. However, solving financial problems through a bankruptcy case can be very difficult without any legal help. If you wish [&hellip;]<\/p>\n","protected":false},"author":1,"featured_media":3773,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[35,1459,1439],"tags":[],"_links":{"self":[{"href":"https:\/\/phoenixfreshstartbankruptcy.com\/wp-json\/wp\/v2\/posts\/3771"}],"collection":[{"href":"https:\/\/phoenixfreshstartbankruptcy.com\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/phoenixfreshstartbankruptcy.com\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/phoenixfreshstartbankruptcy.com\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/phoenixfreshstartbankruptcy.com\/wp-json\/wp\/v2\/comments?post=3771"}],"version-history":[{"count":2,"href":"https:\/\/phoenixfreshstartbankruptcy.com\/wp-json\/wp\/v2\/posts\/3771\/revisions"}],"predecessor-version":[{"id":4328,"href":"https:\/\/phoenixfreshstartbankruptcy.com\/wp-json\/wp\/v2\/posts\/3771\/revisions\/4328"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/phoenixfreshstartbankruptcy.com\/wp-json\/wp\/v2\/media\/3773"}],"wp:attachment":[{"href":"https:\/\/phoenixfreshstartbankruptcy.com\/wp-json\/wp\/v2\/media?parent=3771"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/phoenixfreshstartbankruptcy.com\/wp-json\/wp\/v2\/categories?post=3771"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/phoenixfreshstartbankruptcy.com\/wp-json\/wp\/v2\/tags?post=3771"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}