Keep Your Property And Pay Debt Over Time With A Chapter 13 Bankruptcy
Other Filing Options
Chapter 7 Bankruptcy
A Chapter 7 bankruptcy is intended to quickly eliminate all dischargeable debt, and allow individuals to begin rebuilding their finances as quickly as possible. Chapter 7 is also used by businesses to terminate operations, and resolve tax liabilities that might otherwise become personal liabilities of the principals.
Chapter 13 Bankruptcy
A Chapter 13 bankruptcy, also referred to as a “Wage Earner’s Plan,” allows time to bring past due payments on home loans and car loans, and avoid foreclosure or repossession while payments are made under a court approved plan.
Chapter 13 can also be filed when individuals have too much disposable income under the Means Test under Chapter 7.
A Chapter 13 bankruptcy filing will immediately stop foreclosures, repossessions, wage garnishments, lawsuits and collections, and provide a period of three to five years to repay debt under Court protection.
Under a Chapter 13 bankruptcy, monthly payments can be made to eliminate debt under court protection.
Lower Monthly Payments Under Court Protection
A Chapter 13 bankruptcy, also called a wage earner’s plan, enables individuals with regular income to apply their disposable income against their debts in monthly installments over three to five years.
If current monthly income is less than the state median, the plan will be for three years unless the court approves a longer period for cause. If current monthly income is greater than the applicable state median, the plan will generally be for five years.
During the repayment plan, past due payments on home loans and car loans can be brought current. All dischargeable debt will be eliminated by the end of the repayment plan.
A Chapter 13 bankruptcy can have a number of advantages over liquidation under Chapter 7.
Learn 10 benefits of Chapter 13 bankruptcy here.
For example, a Chapter 13 bankruptcy provides individuals an opportunity to save their homes from foreclosure, and bring past due delinquent mortgage payments current over time, while current mortgage payments are paid on time.
Another advantage of Chapter 13 is that it allows individuals to reschedule secured debts (other than a mortgage for their primary residence) and extend them over the life of the Chapter 13 plan.
Chapter 13 also has a special provision that protects co-signers who are liable with the debtor on consumer debts.
We Can Help
We represent individuals and businesses in all aspects of bankruptcy proceedings, as well as debt settlements and loan restructurings. Call (509) 624-4600 or email email@example.com for further information regarding a possible bankruptcy filing under Chapter 7, Chapter 11, Chapter 12, or Chapter 13.