Some retirees in Texas may benefit from filing for bankruptcy if they are struggling with debt. Chapter 13 bankruptcy may allow them to do so without losing their assets.
Many older people may have second or third mortgages or other lines of credit on their homes, and filing for Chapter 13 bankruptcy can in some cases strip those security interests if the amount owed on the principal mortgage is greater than the value of the house. However, this is not possible under Chapter 7.
Bankruptcy does remain on the filer's credit report for a number of years. However, one of the main reasons people need to protect their credit is so that they can purchase a home, so for older people who own their homes, this will be not as much of an issue. Furthermore, there are a variety of organizations that assist people in rebuilding their credit. Debtors should also make certain they have an idea of what the process will cost and that they are honest about income and assets in their filing.
Regardless of their age, those who are concerned about how much debt they have accumulated may want to consult an attorney about whether filing for bankruptcy is their best option for debt relief. The two principal forms of consumer bankruptcy are in some cases considerably different in their approach and consequences. Chapter 13 is principally designed for those who have a reliable source of income, and it provides for the repayment of certain obligations over a period of from three to five years. Filing for either Chapter 13 or Chapter 7 can in some cases provide at least a temporary halt to creditor harassment and collection activities.