CHAPTER 13 BANKRUPTCY
Filing for Chapter 13 bankruptcy allows you to reorganize most of your personal finances by setting up a monthly payment to your creditors that pays back a portion of the amount you owe. The amount required to be paid on these bills is determined by several factors, including the amount and type of debts you have, the amount you can afford to pay each month, and the value of the property you owe.
Chapter 13 Bankruptcy & Payment Plans
In order to file for Chapter 13 bankruptcy, you must have a regular source of income. Chapter 13 will not result in the loss of property unless you choose to return property, and it will help you handle payments to difficult creditors like the IRS and student loans.
Payment plans can last between three and five years. For most of your debts, the payment plans will completely eliminate the entire debt — even if the debt is not paid in full by the end of the payment plan. Individuals with a steady source of income and the ability to make consistent payments on their debt may find chapter 13 bankruptcy as an appealing option.
Should I file for Chapter 7 or Chapter 13?
This is a common question that individuals have when they begin to consider bankruptcy. While both options can provide a viable solution for overcoming your debt and getting your life back on track, there are a few key differences to consider that may sway your decision. Those include:
A Chapter 7 bankruptcy may be best if you don’t own a home or an expensive car, while Chapter 13 can be a better fit if you’ve invested significant equity into a home and you don’t want to lose it.
Chapter 7 bankruptcy may be the right fit for you if your monthly income barely covers your basic needs and expenses or if you are unable to make end’s meet. Chapter 13 may be a better fit if you have a regular income, can afford your monthly expenses, but are having trouble making the scheduled payments on your debt.
Chapter 7 bankruptcy usually allows you to discharge your unsecured debts. Chapter 13 bankruptcy allows you to keep your property by spreading out your payments.
Chapter 7 bankruptcy cases can take just a few months to complete, while Chapter 13 cases usually involve setting up payment plans that are three to five years in length.
Of course, this is just a general overview of the differences between Chapter 7 and Chapter 13. If you’re unsure which option may work better for you, contact our team for a free consultation. You can learn how each option will affect you short-term as well as long-term factors to consider.
CHAPTER 13 BANKRUPTCY ATTORNEYS IN PIEDMONT TRIAD
Bolton Law Group, P.A. serves individuals and businesses seeking bankruptcy advice and debt relief. With an office in Greensboro, North Carolina, the board certified attorneys of Bolton Law Group have assisted more than 15,000 individuals and businesses in the Piedmont Triad area. Attorneys Phil Bolton and Diana Santos-Johnson will consult with you about your options, provide expert guidance for financial recovery, and give you long-term advice that’s built on strong financial principles. Contact our team today to learn how you can get the financial restart you need.