Chapter 13 Bankruptcy
You know you are in over your head with debt, but are afraid to lose your car or your home. Maybe you have considered filing bankruptcy, but you are holding off until the very last desperate moment. For individuals and families wanting to wipe the debt slate clean and start all over, then filing for Chapter 13 bankruptcy may be a great option for you. There are lots of benefits to filing for Chapter 13 including:
- You can save your home from foreclosure.
- Can keep your vehicles.
- Will help lower your monthly payments.
- Can lower, or even eliminate, your interest rates.
- Occasionally, your late fees may be waived.
- Self employed and small business owners are eligible.
- Payments can be made through payroll deductions.
- Reschedule secured debts, other than your mortgage.
- Creditors will stop contacting and bothering you.
- Special provision that helps protect co-signers.
- No more collection calls!
How does it work? Basically Chapter 13 bankruptcy involves putting together a repayment plan over the course of three to five years. No Chapter 13 bankruptcy should last longer than five years. Debtors will get to keep their property while paying off their debts at a reasonable pace. Part of the process includes calculating the debtor’s normal living expenses. Anything over that is then redistributed amongst the creditors. Once a debt gets paid off, the payment for that debt is then added to one of the other ones to pay it off faster.
There are some eligibility requirements and restrictions when it comes to Chapter 13 bankruptcy. The debt must be under $336,900 and all the secured debt must not exceed $1,010,650. You will need to have a regular income and be able to prove you can make the regular payments or the repayment plan structure of Chapter 13 bankruptcy would not work. Even the self-employed and small business owners are eligible to file for Chapter 13. Unfortunately, if you are a corporation or partnership, you will have to look into a different bankruptcy option such as a Chapter 11 reorganization.
If you are considing in the Merced area, you should call a Merced California Bankruptcy Attorney to help guide you through the confusion and get your creditors off your back.