Chapter 13 Bankruptcy: Is it a Smart Choice for Your Case?
Each year, thousands of Americans file for bankruptcy as part of their efforts to gain financial control. The bankruptcy process can give debtors a fresh start while also teaching invaluable lessons related to financial management. In many cases, debtors must choose between filing for Chapter 13 and Chapter 7 bankruptcies. Therefore, understanding the breakdown of Chapter 13 bankruptcy can help you decide if it is a smart option for your particular case.
What You Need to Know about Chapter 13 Bankruptcy
Chapter 13 offers debtors the opportunity to organize debt into a structured payment plan. According to Uscourts.gov, Chapter 13 applicants must meet certain criteria in order to be eligible.
First, applicants must have a steady income that will allow them to make payments according to the agreed upon schedule. In fact, debtors with a high income may not be eligible for Chapter 7 bankruptcy.
In addition to meeting the income requirements, Chapter 13 applicants must not have more than $380,000 in unsecured debts. Secured debts cannot exceed $1 million.
In some cases, it may be possible for Chapter 13 filers to adjust their payment plan. However, it is generally advisable to be as diligent as possible when making payments. If there is any doubt as to whether or not you will be able to make payments, the courts may require a portion of your paycheck to be set aside to pay creditors.
Chapter 13 bankruptcy involves a complete overview of all debt owed, as well as your income and living expenses. These and other factors will determine the specifics of the repayment plan.
Filing for Chapter 13 bankruptcy will put an end to the efforts of debt collectors, as well as foreclosures. This makes Chapter 13 an attractive option for those who are trying to maintain ownership of their assets.
Consult with a Knowledgeable Bankruptcy Attorney Today
If you have questions regarding Chapter 13 bankruptcy options and would like to discuss your bankruptcy case with a McHenry County bankruptcy attorney, please contact the Thomas Law Office today at 847-426-7990 to schedule a consultation.
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Thomas Law Office has been serving the needs of clients throughout McHenry County and Kane County in cities such as Elgin, South Elgin, Barrington, Carpentersville, Marengo, West Dundee, East Dundee, Algonquin, Lake in the Hills, Huntley, Crystal Lake, Woodstock, Bull Valley, Fox Lake, Fox River Grove, Harvard, Hebron, Holiday Hills, Huntley, Island Lake, Geneva, Wonder Lake and Cary.
