Chapter 13 Bankruptcy
CHAPTER 13 BANKRUPTCY
Many times individuals may not qualify for a Chapter 7 because they make too much income. In those cases, a Chapter 13 may be what is most appropriate. A Chapter 13 bankruptcy can help you if you own assets that would otherwise be liquidated in a Chapter 7 situation or if you want to restructure certain mortgages or car loans. A Chapter 13 debtor files a plan of reorganization that allows him or her to consolidate every bill into one monthly payment that is supervised by the court. A Chapter 13 debtor is allowed to keep his or her assets and pay creditors with lower or no interest accruing and the process can stop foreclosures, collection lawsuits and repossession.
CHAPTER 13 PLANS
The Chapter 13 plan sets forth how a debtor plans to fully or partially repay creditors. Beginning 30 days after the Chapter 13 case is filed, the debtor makes monthly payments to the Chapter 13 trustee who is responsible for distributing the funds to the debtor’s creditors as set forth by the plan. All of the debtor’s “disposable income” must be used to pay the creditors. Disposable income is the amount left over after paying necessary expenses. The plan must also pay the unsecured creditors at least what they would have received.
HOW DO I KNOW IF A CHAPTER 13 IS THE BEST OPTION FOR ME?
There are various circumstances where filing a Chapter 13 may be the best option for you, including:
- If you have a large amount of nonexempt assets that you want to keep;
- If you are past due on your mortgage or car loan payments and you need time to catch up before foreclosure or repossession occurs;
- If the value of your real or personal property is such that you can eliminate or reduce secured debts against the property;
- If you have debt, such as certain tax obligations or student loans that cannot be discharged, you can include these debts in your Chapter 13 plan and pay them off over time; and/or,
- If you have a co‑debtor on a personal loan that you want to protect, you may be able to do so in a Chapter 13.
The most important thing to remember is that bankruptcy gives you an opportunity to start over and rebuild and, in this highly unusual period of time in American history, that is something that we all may need to consider. The team at Oppenheim Law are, of course, here to help you navigate these waters. If you are seeking legal representation, contact us online or give us a call at 954-384-6114 to schedule a consultation. We offer video chat and video chat and conference.
Oppenheim Law | Bankruptcy Attorneys
2500 Weston Rd #404
Fort Lauderdale, FL 33331