Chapter 13 Bankruptcy Lawyer – What is Chapter 13?
Chapter 13 of the United States Bankruptcy Code is a judicial method of providing relief to individuals by restructuring or reorganizing debt that is owed, discharging (eliminating) some debts and giving the person more time to repay other debts. For this reason, filing for bankruptcy under Chapter 13 is often called a “reorganization”.
Under Chapter 13, the person or couple filing for bankruptcy protection will have their debts, income, assets, and liabilities examined thoroughly. Then a payment plan will be created, where the person or couple will make payments for 3-5 years to repay a portion of their debt before receiving a discharge of the remaining dischargeable debt.
Chapter 13 bankruptcy is more expensive than Chapter 7 bankruptcy but provides more protection and can stop foreclosures permanently. For more information, see “Comparison Between Chapter 7 and Chapter 13 Bankruptcy.”
Chapter 13 filers must complete a “Means Test.” This test requires filers to furnish information about their assets, liabilities, and income, and then a calculation is done, which is designed to help determine whether the person or couple are likely to be able to repay the amounts that they owe based upon income and other factors. The score resulting from the prescribed calculation will then determine whether the person will have a 3-year payment plan or a 5-year payment plan.
How I Help Clients in Financial Distress
If you are in financial distress, your best option will be to take action – today.
In some instances, it is possible to negotiate with creditors to restructure debt. Most creditors prefer that those owing money address delinquent payments, rather than avoiding contact.
In other instances, creditors may not be willing to negotiate debts, and/or a person’s debts may be too large to overcome. In these circumstances, I help by advising clients of their options, including filing bankruptcy under Chapter 7 or 13.
Because secured creditors (such as the bank holding your mortgage or the company that made your car load) will typically not wait long before taking action (including repossession and foreclosure), it is important to take action as soon as possible.
Please Call Today to Learn About Your Options
I would look forward to advising you regarding your options for your financial situation once I learn about your circumstances. I offer dedicated representation and affordable rates.