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Bankruptcy Chapter 13

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Bankruptcy Chapter 13

A Chapter 13 bankruptcy can be a good solution for people who need time to pay off certain debts and who have too much income for a Chapter 7 bankruptcy and enough income to meet the Chapter 13 requirements. With the help of a qualified Bankruptcy attorney, you get to keep all of your property, regardless of its value. However, you will have to pay your unsecured debtors (those to whom you owe credit card debts, medical debts, and most court judgments, for example, the value of the property you would lose if you filed for Chapter 7 bankruptcy. However, many times this can be pennies on the dollar compared to the amount paid with interest over the course of the unsecured loan.

Your Home in Chapter 13

If you are facing a possible foreclosure of your home, Chapter 13 provides a powerful remedy. You can keep your home by proposing a feasible repayment plan that includes your missed payments, as long as you stay current on your mortgage.

The Plan

Using the difference between your current monthly income and your expenses or sometimes standards set forth by the Internal Revenue Service, a Chapter 13 bankruptcy generates what is called a “disposable income”. In general this disposable income is used to fund “a repayment plan”. This repayment plan can be good news for those individuals who are falling behind making their payments month after month. The plan will only require an individual to pay back that amount that they can afford to pay back after all their normal reasonable expenses have been paid. This allows the debtor money to survive without giving up necessary goods or services.

Although a debtor can file a Chapter 13 bankruptcy on their own, it is advisable that a debtor consult a qualified attorney because the process can be confusing and time consuming to those not familiar with the process. Contact our office for more information and the help you need