How Chapter 13 Works and Why Should You Consult a Bankruptcy Lawyer?
Chapter 13 bankruptcy is mostly applied to businesses. The petitioner should submit a rearrangement plan that secures the properties from foreclosure or repossession and normally wishes forgiveness of some debts. It is completely different from chapter 7 case, which liquidates all properties except the protected ones. Keep in mind that no bankruptcy filing removes all debts. Alimony payments and child sustenance are not dischargeable, even the unpaid taxes and student loans. The good thing about bankruptcy is it can clear a number of debts. On the other side of it is, it will possibly become harder for the debtor to borrow in the coming future.
You must consult an experienced bankruptcy attorney that handled chapter 13 cases before you jump to your conclusions. To become entitled to file for bankruptcy chapter 13, the borrower should not exceed the limit amount of unsecured debt. Unsecured debts are the personal loans or credit card bills. The debtor must not also exceed the limit amount of secured debts. The secured debts involve car loans and mortgages.
Filing chapter 13 Moreno valley will prevent foreclosure of your house. One of its effects is to suspend any present foreclosure proceedings as well as repaying any other debts. It doesn’t remove the debt however, it buys time while the court evaluates and considers the next thing to do. This bankruptcy plan gives relief by letting the debtor keep his own house and freedom for his income which enables him to make mortgage payments regularly.
To be eligible to file for chapter 13 bankruptcy the borrower should have:
- Fallen behind on a secured loan for a car, house or other pieces of asset and heading towards the probability of foreclosure and repossession.
- Properties that are not exempted but entitled to protection under chapter 7 bankruptcy.
- Sufficient disposable income to repay a major cut of the debt over the period of time.
There are many factors that can determine eligibility for chapter 13. For proper knowledge do not hesitate to consult a lawyer, you can check on the internet and type in bankruptcy attorney near me and choose only the ones who are experienced for better understanding.