Filing Bankruptcy Chapter 13

What is Bankruptcy Chapter 13?

A Chapter 13 is a court-approved plan to repay your debts. The plan payment period is usually between three to five years. During this period, you make regular payments to a Chapter 13 Trustee, who, in turn, distributes the money to your creditors.

To file a Chapter 13, you must have a regular monthly income (social security benefits, wages, pensions, or self-employment income) and meet certain debt limitations for your unsecured and secured debts.

How does a Filing a Chapter 13 bankruptcy plan help save your home?

A timely filed Chapter 13 bankruptcy case imposes an automatic stay, which stops all collection activity. Thus all pending foreclosures  proceeding must be dismissed. A Chapter 13 filed prior to a scheduled Sheriff's Sale stops the judicial sale.

The Repayment Plan pays the delinquent mortgage payments allowing you to bring your mortgage account current.

Can a Chapter 13 help you get your suspended license back?

Yes, it can! If your driver's license has been suspended because of unpaid tickets or judgements entered against you, a Chapter 13 can help to reinstate your driving privileges.

What happens after the Chapter 13 case is filed?

After we file the bankruptcy case, we will send a letter advising you when and where to start making your Chapter 13 payments. If you wish, the payments can be deducted from your paycheck. Your payments are sent to a Court-appointed trustee, who in turn will distribute the payments to your creditors.

You will have to attend a MANDATORY meeting at the Trustee's office. At this meeting, you will be asked questions concerning your current income and expenses.

About two months after the case is filed, the Court will approve your plan. As long as you make your payments on time every month, your debts will be paid in full. You will receive a Court-ordered discharge of your debts, when the plan is done.

Advantages of a Chapter 13

You can have up to 60 months to get caught up with your mortgage arrears.

You may pay back as little as 10% to your unsecured creditors.

You can still sell your home or refinance.

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