Chapter 13 Bankruptcy
File with a Santa Clarita Bankruptcy Lawyer
When people are considering
filing for bankruptcy, many are not even aware that there is more than one kind of bankruptcy
to “choose from.” Depending on your financial situation, as
well as the size and value of your estate, you might end up qualifying
for Chapter 13 bankruptcy. This form of bankruptcy does not flat-out liquidate
debts owed to creditors, but instead involves a structured repayment plan
that can last for several years.
Before you make any decisions, consult with a Santa Clarita bankruptcy
attorney from The Werner Law Firm first. Call 888.630.9902 today.
Benefits of Chapter 13 Bankruptcy
The first thing you might think when you hear that Chapter 13 bankruptcy
involves a repayment plan instead of eliminating all debts immediately
is that it is a worse form of bankruptcy. This is not true. Chapter 13
is unique from Chapter 7 bankruptcy – which traditionally will remove
all debts – and, therefore, has its own unique set of pros and cons.
Some advantages to choosing Chapter 13 over Chapter 7 include:
- Stalling home foreclosures
- Lessening impact on credit scores
- Addressing student loans
- Stopping interest from building on tax debt
- Keeping non-exempt property
It is important to realize that while Chapter 13 does not eliminate
all debt, it may drastically reduce some debt. This is particularly common
for credit card debt. For example, you might owe $20,000 in credit card
debt but your Chapter 13 restructuring only asks you to pay $200 a month
for three years. Ultimately, you would pay back just $7,200 but the entire
$20,000 debt would be discharged.
Requirements for Chapter 13 Filings
The bank and your creditors are not responsible for your debt. It will
be up to you to propose a repayment plan that works for everyone. This
is where professional legal guidance plays a big part in success. Your
bankruptcy attorney will be able to analyze your income, debts, and estate
value, and craft a repayment plan that not only helps you relieve financial
worries but also satisfies your creditors. After all, nothing will get
done if they turn down your offer and cite it as unreasonable.
Three main requirements for Chapter 13 bankruptcy plans include:
- You must present a reasonable argument as to how you can and will stick
to your restructured strategy.
- You must pay unsecured creditors an amount that is at least as equal as
what they would have gotten if Chapter 7 was filed instead.
- You must put all disposable income into your payment plan – you will
be living only with necessities for the next three to five years.
Contact Our Firm Today and Find Peace of Mind
The shadow of overwhelming debt can be a real burden on anyone. You might
be finding it difficult to enjoy day to day life knowing that creditors
are waiting for your last penny earned. At The Werner Law Firm, we have
been serving Southern Californians
since 1975, and we know all about the pressures you are feeling and how they can
be alleviated. We are honored to say that many of our past clients have
provided us with appreciative
testimonials for those in need of legal counsel to review and gain a better understanding
of how we can help them.
Let our Santa Clarita bankruptcy attorneys guide you through your Chapter
13 bankruptcy filing.
Contact us or fill out a
free online case evaluation form today.