CHAPTER 13 BANKRUPTCY

General Information - Chapter 13 Debt Relief

Are you:

• Behind on your car or house payment with the threat of repossession or foreclosure hanging over your head?
• Facing a large tax bill because of interest and penalties which keep adding up?
• Unable to make the regular monthly payments on your credit card bills?

If so, then Chapter 13 bankruptcy is a very powerful tool for you. It can be used to stop a house foreclosure, allowing you to catch up on missed mortgage payments and keep your house.

 

You can also use it to refinance your auto loan. We do this by cramming down your car payments to pay off only what your car is worth, not what you owe on it. For example, if you owe $15,000.00 on your car and your monthly payments are now $355.00, we can reduce your monthly payments to $161.00 if your car is actually worth only $6,500.00. Additionally, we can also lower the interest rate on the loan down to 10%.

You can also pay off back taxes through your Chapter 13 plan and stop interest and penalties from accruing on your tax debt.

 

Once we file the case with the bankruptcy court your creditors are stopped in their tracks. When you file for Chapter 13 bankruptcy (or any other kind of bankruptcy), something called the automatic stay goes into effect. It immediately stops your creditors from trying to collect what you owe them. Creditors cannot repossess your car, foreclose on your house, garnish your wages, empty your bank account, or cut off your utility service or welfare benefits.

Some people use Chapter 13 bankruptcy to buy time. For example, if you are behind on mortgage payments and about to be foreclosed on, you can file Chapter 13 bankruptcy papers to stop collection efforts, and then attempt to sell the house before the foreclosure.

Chapter 13 bankruptcy requires discipline. For the entire length of your case (three to five years), you will have to live under a strict budget; the bankruptcy court will not allow you to spend money on anything it deems nonessential.

 

The majority of debtors never complete their Chapter 13 repayment plans. Although most people file for Chapter 13 bankruptcy assuming they'll complete their plan, only about 30% of all Chapter 13 debtors do. Many drop out very early in the process, without ever submitting a feasible repayment plan to the court. If you can come up with a realistic budget and stick to it, however, you should have no trouble completing your Chapter 13 plan.

If you want, your bankruptcy plan payments can be deducted from your wages during your case. If you have a regular job with regular income, the bankruptcy court will probably order that the monthly payments under your Chapter 13 plan be automatically deducted from your wages and sent to the bankruptcy court.

 

Chapter 13 bankruptcy can stay in your credit file for up to ten years from the day you file your papers, although rarely are Chapter 13 bankruptcies reported for more than seven years. After your case is over, however, you can take steps to improve your credit. In fact, some Chapter 13 bankruptcy courts have established programs to help you do just that. In such a program, if you have paid off around 75% or more of your debts, you may attend money management seminars and apply for credit from certain local creditors.

 

Bankruptcy rules vary from court to court. Bankruptcy law comes from the federal Congress and is meant to be uniform across the country. But when disputes arise about the bankruptcy laws, bankruptcy courts make the decisions--and they don't all decide the issues in the same way. The result is that bankruptcy law and practice vary significantly from court to court and from region to region. That’s why it is important to find an attorney who is very familiar with how the Bankruptcy courts operate in your particular area. If you live or work in the greater San Diego area and have questions about Chapter 13 Bankruptcy, why not call The Law Offices of Miller Legal Center or The Law Offices of Doan Law Firm. We will be happy to schedule your FREE no obligation initial consultation to answer your questions about Bankruptcy. Your free consultation with an attorney takes only about 30 minutes and isn’t your financial future worth 30 minutes of your time???

Doan Law Firm & Miller Legal Center

The Law Offices of Doan Law Firm
and Miller Legal Center

We provide pre-petition planning to assure you the highest level of protection available. More than 99% of our clients KEEP EVERYTHING AND LOSE NOTHING. Our offices can achieve this by careful pre-petition planning and by taking advantage of the special exemptions allowed you by law. If you live or work in the greater San Diego area and have questions about Bankruptcy, why not call now? We will be happy to schedule your FREE no obligation initial consultation to answer your questions about Bankruptcy. Your Free consultation with an attorney takes only about 30 minutes and isn't your financial future worth 30 minutes of your time???

Material on this site should not be considered legal advice and does not constitute an engagement of Doan Law Firm or Miller Legal Center. The information contained herein is of a general nature and may not apply in your particular circumstances.