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Evaluating the costs of filing for bankruptcy

Massachusetts residents may be able to either discharge or restructure debt by filing for bankruptcy. It will either be considered as a liquidation or a reorganization, and bankruptcy laws that are created by Congress apply to everyone in the country. The cost of filing for bankruptcy depends on the type of protection sought as well as whether an individual chooses to hire an attorney.

Those who choose to file for Chapter 7 bankruptcy in 2017 will pay a base fee of $335. In a Chapter 7 case, a trustee will collect an individual's non-exempt assets, sell them and use the money to repay creditors. Chapter 13 bankruptcy allows an individual to propose a plan to repay debts over a period of up to five years. The base fee to file for a wage earner's plan in 2017 is $310.

Chapter 12 bankruptcy is available to family farmers, and the farm can continue to operate while the case is pending. The cost to file for Chapter 12 bankruptcy in 2017 is $275. Those who are thinking about filing for bankruptcy should be aware that it could have long-term consequences on their credit reports and scores. A Chapter 7 bankruptcy filing remains on a credit report for 10 years while the period is seven years for a Chapter 13 petition.

Debtors who are seeking debt relief may want to consider filing for bankruptcy. There may be many benefits to doing so such as possibly putting an end to creditor phone calls or other forms or harassment. It may also make it possible for debtors to prevent a foreclosure or repossession from taking place. An attorney can explain the process in more detail.

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