Mesa Unsecured Debt Attorney
If you are considering filing for bankruptcy, the type of debt you are carrying can be an important indicator of which chapter of the Bankruptcy Code will be the best fit for your debt relief needs. In order to make the best choice for your situation, it is important that you understand the difference between secured and unsecured debt.
Secured Debt
Secured debt is a debt that is backed by some sort of collateral. Your car loan is backed by your car. Your home mortgage is backed by your house. If you are not able to keep up with the payments on these loans, the lender has the right to seize the property that secures them.
Many people who file for bankruptcy because of unmanageable secured debt choose to file under Chapter 13 because it gives them the opportunity to repay the arrearages as part of the repayment plan and offers a way for them to keep the property as long as they are able to keep making the payments going forward. An experienced Phoenix secured debt attorney can review your circumstances and help you understand your options.
Unsecured Debt
On the other hand, unsecured debt is a debt that is not backed by collateral. You make an agreement with the creditor to repay the debt according to specific terms. Generally, the creditor's only option in these cases is to pursue legal action to recover the debt. Credit cards and medical bills are both examples of unsecured debt.
People having trouble keeping up with unmanageable amounts of unsecured debt often file for bankruptcy under Chapter 7 because it allows them to eliminate their debts and walk away with no further obligation to the creditor once the discharge has been received.
Finding the Right Debt Relief Solution for You
At the Law Offices of Farnsworth Mortensen, PLLC, our bankruptcy lawyers provide comprehensive consumer debt relief services. From our offices in Phoenix, Mesa and Tucson, we help clients across Arizona with consumer bankruptcy filings and other debt relief solutions. Contact our office today to schedule a free initial consultation, or call 888-634-0000 toll-free.
We are a debt relief agency. We help people file for bankruptcy relief under the Bankruptcy Code.
