August 31st, 2009 by bankruptcy
This is especially for debtors whose income is regular and who want to adjust the debts by repaying over a span of 3 to 5 years.
Chapter 13 Introduction
The Chapter 13 Bankruptcy is known as a plan for wage earners. This plan facilitates the debtors with stable income to repay the part of or all the debt through installments over a period of 3 to 5 years. The duration of chapter 13 bankruptcies can be 3 years if the present monthly income of the debtor is less than the state median that is applicable. The plan can be extended provided the court approves for it but this duration cannot go beyond 5 years. The creditors can neither start nor continue any efforts for collecting money from the debtor during this period.
How is it lucky for debtors?
Filing chapter 13 bankruptcies offers the debtors with a chance to save their houses from foreclosure.
The proceedings for foreclosure can be averted for some time. The debtor gets a chance to repay mortgage payments over an extended period. The debtor has to regularly do the mortgage payments as mentioned in the schedule when Filing Chapter 13 Bankruptcy. The debtor gets extra time to reschedule secured debts. The amount of payment can be lowered. There is a provision in chapter 13 that protects the co-signers. Filing chapter 13 behaves as if it is a consolidation loan. The chapter 13 trustee does the payments to the creditors. According to chapter 13 bankruptcy rules the debtor and creditors never come in direct contact.
Who is eligible?
Filing Bankruptcy under chapter 13 needs the debtor to be employed. The total unsecured debt should not be more than $307,600. The total secured debt should be less than $922,950. The revolving accounts and the credit cards form the major crunch of the unsecured debt. Home loans and car loans are included in secured loans. One should consult a Bankruptcy Attorney, seek bankruptcy advice, and know about being eligible for filing chapter 13 bankruptcy.
How to file?
The process of filing chapter 13 bankruptcies seems complicated but very simple for a lawyer who is specialized in filing chapter 13. This sort of lawyer is also called Chapter 13 Bankruptcy Attorney.
If you enjoyed this post, make sure you subscribe to my RSS feed!
This entry was posted on Monday, August 31st, 2009 at 10:17 pm and is filed under Business, Financial Planning, bankruptcy, financial education. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.