Chapter 13 bankruptcy is a restructuring bankruptcy for individuals. Chapter 13 allows you to retains assets like your car and your home and slowly pay off your debts over 2 to 5 years. Bankruptcy is a very difficult decision to make, and one you should consult a Chapter 13 lawyer before moving forward. Besides staying on your credit for many years, bankruptcy will also make borrowing money very difficult and may make finding employment more difficult. It is very important that you explore all other options and hire a Chapter 13 attorney before making the decision to file.
If you are overwhelmed with debt you cannot pay, but can afford and wish to keep your home or other assets, then it is possible that Chapter 13 will work for you. There are a few basic requirements you need to meet, but keep in mind that states may have different eligibility requirements. First, you must be employed as you need to be able to make monthly payments. Second, you must have a large amount of debt, usually over $10,000 but under $250,000. Again, these requirements will vary by state. If you live in Florida, you should contact a Chapter 13 Miami lawyer to determine if you are eligible to file.
So, how does Chapter 13 work? You, your lenders, and Chapter 13 lawyers will reach an agreement on affordable monthly payments over a period of time. Interest and late fees will stop accruing and you will slowly pay off most of your debt. Your debtors will usually agree to discharge the remaining balance you owe at the end of the agreed upon payment period. You will no longer be liable for the remaining balance, and you keep your car and home. It is essential to make the payments on time each month, or your debtors may not discharge the remaining debt. Also, you need to be able to afford to make other payments such as mortgage or car payment in addition to the bankruptcy payment. Every situation will be different, it is very important to hire a Chapter 13 Law Firm to help design a repayment plan that will work for your unique situation.
Keep in mind that bankruptcy can be very intrusive to your personal life. Your debtors and their lawyers will evaluate your expense and your budget to verify that you cannot pay and that you will be able to afford the agreed upon payments. . You will need to closely evaluate your budget and see where you can cut back. This will be very difficult, but just keep in mind after the payment period is over you will be free of most of your debt and will be able to keep your family’s home.
Chapter 13 is one of the most complicated types of bankruptcy. It is very important to have Chapter 13 attorneys on your side through out the process to make sure you and your lenders reach the best possible out come. You can be sure your lenders have lawyers on their side, you should have someone fighting for your interests.