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Key considerations before filing for Chapter 7 bankruptcy

If you are struggling with a high amount of debt, you may have already read about the potential benefits of filing for Chapter 7 bankruptcy. This bankruptcy filing can be particularly beneficial for those who have a low income and a high amount of debts.

However, every type of bankruptcy chapter comes with limitations. This is why it is important to consider every aspect of a bankruptcy chapter before making the decision to commit. The following are some key things to consider before filing for Chapter 7 bankruptcy.

Chapter 7 bankruptcy will cost money

Chapter 7, like any bankruptcy filing, will require that money is paid upfront. The total cost of a Chapter 7 bankruptcy could be up to $2,500. However, this is significantly cheaper than the potential cost of a Chapter 13 bankruptcy. Additionally, this sum of money should be seen as an investment rather than a cost.

You need to qualify for Chapter 7 bankruptcy

Not everyone can file for Chapter 7 bankruptcy. You must undergo a means test to show that you cannot realistically afford to pay off your debts.

Your credit history will give information about your bankruptcy

While Chapter 7 bankruptcy can give you a financial fresh start, you will not be able to wipe the slate clean in regard to your credit history. A bankruptcy filing could stay on your credit history for 10 years.

If you are thinking about filing for a Chapter 7 bankruptcy in Kentucky, it is important to understand the ways that this will affect your life. Many people benefit greatly from getting a financial fresh start.