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Chapter 13 Bankruptcy
Chapter 13 bankruptcy is usually called a wage-earner’s plan. It is a way for individuals with regular monthly income to repay some or all of their debts. Rather than having assets liquidated, this process consolidates debt into a single, reasonable monthly payment that can be paid gradually over a period of 3 to 5 years. By filing Chapter 13, an individual facing foreclosure will be able to stop a foreclosure and put a stop to harassment from lenders and creditor. At the same time, it allows the bankrupt individual to begin establishing new credit immediately rather than continuing to lose it as payments are missed.
Because Chapter 13 bankruptcy protects real property and personal possessions, it is a better option for individuals who have non-exempt assets or those that cannot qualify for a chapter 7 as a result of income or assets. Some of the advantages of a Chapter 13, over Chapter 7 is that delinquent mortgage payments can be cured in a chapter 13. Also, chapter 13 is like debt consolidation loan where the individual makes monthly payments to the trustee who in turns pays the creditors. The individual has no direct contact with the creditors during the duration of a chapter 13, thereby getting the peace of mind provided for by bankruptcy.
Anyone considering filing for bankruptcy should contact a lawyer immediately to begin consultation on the best course of action. We Legal APC’s trained professionals can offer wise advice and timely service to begin filing while halting a financial slide before the damage is insurmountable.
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