FORMER CHAPTER 13 TRUSTEE STAFF ATTORNEY
CHAPTER 13 BANKRUPTCY
Chapter 13 Bankruptcy also known as “reorganization” or “wage earner” bankruptcy. It is understood that you do wish to repay your bills but just need a little more time or that you do not qualify for Chapter 7. As such, Chapter 13 might be just what you need.
In reorganizing your debt, you may not be responsible to pay all or a majority of your unsecured debt. This will allow you to keep your assets and pursue a debt free existence through a reasonable debt repayment plan.
We are highly equipped to answer your questions and provide you with the adequate advice to make an informed decision. If you would like to receive feedback from an attorney regarding your finances, please complete the free bankruptcy evaluation or simply call 716-573-4980.
The typical reasons for choosing Chapter 13 over Chapter 7 are:
1. You wish to keep property that you have fallen behind in payments.
2. You are upside down (negative equity) on your first and/or second mortgage and only want to pay back the true value of your home.
3. You are negative equity or upside down on your car and only want to pay the market value of your car.
4. You have tax debts that may not be fully dischargeable in Chapter 7. You have the opportunity to repay these debts in Chapter 13.
5. You do not qualify for Chapter 7 because you have received a Chapter 7 discharge within the past 8 years.
6. You have property that you want to keep which may not be protected in a Chapter 7.
What is the Chapter 13 process?
Chapter 13 bankruptcy allows individuals to reorganize their debt. This reorganization can allow debt to be repaid over a period of 3 to 5 years.
The Chapter 13 begins through the appropriate planning and drafting of your petition. Once the Chapter 13 petition is drafted and signed, it will be filed with the Court. At this point, the Court will assign a Chapter 13 Truste who handles all Chapter 13 cases for your jurisdiction.
The Court will also send out a letter to your creditors notifying them that a Chapter 13 bankruptcy has been filed. At this point, creditors are required to discontinue any communications with you. This is known in Bankruptcy as the Automatic Stay. Once the automatic stay takes effect, creditors will no longer be able to:
1. Continue foreclosure proceedings against your home, and/or
2. Continue a repossession action against your car or other property, and/or
3. Send Collection letters, and/or
4. Continue making harassing phone calls, and/or
5. Begin or continue to garnish your wages, and/or
6. Begin or continue to sue you.
An experienced attorney can help protect you from any violations of the automatic stay. For more, please visit the free bankruptcy evaluation or call 716-573-4980.
What is the Chapter 13 Plan?
The essence of a Chapter 13 bankruptcy is your plan of repayment. This plan is designed and structured to meet your ability to repay some or all of your debts. There are numerous factors to consider in drafting your Chapter 13 plan. An appropriate and affordable plan can be best designed through the experience of a bankruptcy lawyer.
The plan will state a specific amount to be paid monthly. The payments are collected by the Chapter 13 Trustee assigned to administer your case. The Trustee will then make payments to your creditors. Plans typically last between 3 three and five years. Assuming you make all of your payments, you will likely discharge or eliminate the debts as proposed by your plan.
The Chapter 13 plan payments begin the first day of the month immediately following the month in which your Capter 13 is filed. The payment amount is highly dependent upon your individual circumstances.
If you are ready to take control of your finances and pursue a debt free way of life, please complete the free evaluation or call Roger Yehl at 716-573-4980.