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It sounds easy enough. You are up to your ears in debt and need some breathing room. All you need to do is declare bankruptcy. Do you qualify to file for bankruptcy? Have unfortunate circumstances caused you to fall behind on meeting your obligations? If you don’t know whether to file Chapter 7 or Chapter 13, you will need to do a bit of research.
Chapter 13 bankrupcy is generally for people who are regularly employed and who intend to pay their creditors, but have fallen behind in payments and need more time to reorganize payments. They may own a house and cars, and wish to keep them. They may face repossession, wage garnishments, or foreclosure because of divorce, disability, or illness.
Under Chapter 13, all debts (including credit cards) are consolidated and a payment plan is established. All collection efforts (including harassing phone calls) must stop. Foreclosure must stop.
An interest-free payment plan is supervised by a trustee and approved by a Bankruptcy Court. Even if creditors believe the payments are too small, if the Court approves it, the payment stands.
The payments must start 30 to 45 days after the plan is approved, and the person must stay on the schedule to have the debt discharged, typically in 3 to 5 years.
What is the advantage of declaring Chapter 13 bankruptcy? Time: time to breathe and not worry about losing your house or car; time knowing that if you make your payment regularly you can answer the phone and not have to deal with a debt collector; time to get your financial house in order and get a fresh start. Take a breath.
It sounds easy enough. You are up to your ears in debt and need some breathing room. All you need to do is declare bankruptcy. Do you qualify to file for bankruptcy? Have unfortunate circumstances caused you to fall behind on meeting your obligations?
Chapter 13 is generally for individuals who are regularly employed and who intend to pay their creditors, but have fallen behind in payments and need more time to reorganize payments. They may own a house and cars and wish to keep them. They may face repossession, wage garnishments, or foreclosure because of divorce, disability, or illness.
Under Chapter 13, all debt (including credit cards) is consolidated and a payment plan is agreed upon. All collection efforts (including harassing phone calls) must stop. Foreclosure must stop.
An interest-free payment plan is supervised by a Trustee and approved by a Bankruptcy Court. Even if creditors believe the payments are too small, if the Court approves it, the payment stands.
The payments must start thirty to forty-five days after the plan is approved, and the individual must stay on the schedule to have the debt discharged, typically in three to five years.
What is the advantage of declaring Chapter 13? Time: Time to breathe and not worry about losing your house or car; time knowing that if you make your payment regularly you can answer the phone and not have to deal with a debt collector; time to get your financial house in order and get a fresh start. Take a breath.
