Joseph Devine asked:




Chapter 13 Bankruptcy Basics

Though much has been made in recent years about both the individual and corporate financial struggles that are being faced due to the credit crunch and other broad economic factors, the reality is that there have always been genuine challenges to fiscal security. The free availability of consumer credit and predatory mortgage lending practices have combined to create something of a perfect storm for the debt-strapped, and when you add into the mix the fact that developing a credit history is now an essential part of progressing into adulthood, the deck seems to be stacked against the unwitting consumer. In the most overwhelming circumstances, it may be appropriate to consider filing for Chapter 13 bankruptcy protection.

Even if you have been working steadily for years and manage your money responsibly, it is likely that a single accident, serious illness, or other unpredictable and substantial adverse life event can suddenly threaten to undo all that you have built. Part of this is attributable to the dramatically escalating cost of medical care in the United States, which has considerably outpaced increases in the average income of American workers over the past decade. If you are uninsured or exhaust the benefits available under your insurance policy, you can be stuck with tens of thousands of dollars or more in medical debts for even fairly minor injuries.

Elements of Chapter 13 Bankruptcy to Consider

The United States Bankruptcy Code exists to help debtors to resolve their outstanding financial obligations to creditors and service providers. There are forms of bankruptcy that are available to businesses and others that are solely accessible to individuals and families that are suffering from economic woes. Chapter 13 bankruptcies are restricted to individual filers who are employed at the time of the bankruptcy filing and who appear to have some degree of job security.

As each chapter of the Bankruptcy Code is designed to serve a different set of needs and parties, so, too is each of processes differently structured and requiring of distinctly separate qualifications. A few of the relevant details pertaining to Chapter 13 bankruptcy are:

Liquidation of assets is not a required step as it is with many Chapter 7 filings Chapter 13 bankruptcy filings stop and prevent foreclosure actions Debts are not erased, but rather the debtor has the opportunity to propose an extended repayment plan over a 3-5 year period Collection efforts must cease during the bankruptcy plan
For More Information

For further information about credit management and bankruptcy protection, contact the Arizona bankruptcy lawyers of the Harmon Law Office, L.L.C.

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Jay Fleischman asked:




Chapter 13 bankruptcy involves a reorganization of your finances. Through the court-approved Plan you agree to repay some or all of your debts over a 3-5 year period of time. the amount of your payment depends on your income and a variety of other factors, but did you know you may owe too much money to file for Chapter 13 at all?

Under Section 109(e) of the U.S. Bankruptcy Code,

Only an individual with regular income that owes, on the date of the filing of the petition, noncontingent, liquidated, unsecured debts of less than $250,000 and noncontingent, liquidated, secured debts of less than $750,000, or an individual with regular income and such individual’s spouse, except a stockbroker or a commodity broker, that owe, on the date of the filing of the petition, noncontingent, liquidated, unsecured debts that aggregate less than $250,000 and noncontingent, liquidated, secured debts of less than $750,000 may be a debtor under chapter 13 of this title.

Those figures are adjusted based on the annual cost of living based on the Consumer Price Index as adopted by the Judicial Conference of the United States. The U.S. Department of Labor issues the Consumer Price Index figures for the relevant period.

This is good news for the millions of Americans who bought homes during the real estate boom of the last few years. Falling into foreclosure, they’ve turned to Chapter 13 only to find that they are locked out because their mortgages are too high.

When you owe too much you may be forced to file for Chapter 11 bankruptcy to keep your home. This can be far more costly and time-consuming, requiring enormous amounts of work just to accomplish the same goal that you could have gotten in a Chapter 13.

Your other option may be a Chapter 7, which may not protect your home and other property.

For cases filed from April 1, 2007 until March 31, 2010, the Chapter 13 debt limits have been $1,010,650 in secured debt, and $336,900 in unsecured debt. It’s been speculated by some that those limits may go up 7% for cases filed from April 1, 2010 until March 31, 2010. Surely, that will help many consumers who are looking to keep their homes and property in bankruptcy.

If you’re thinking about filing for bankruptcy it’s important to speak with your lawyer before your case is filed to be sure that your debts fall within the limits in effect as of the date of filing. If your case is filed and you exceed the debt limits then you could be forced to convert your case to Chapter 7 or Chapter 11; even worse, you could end up having your case dismissed and very few options in the short run.

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Mark Langer asked:




Along with the economic climate in the situation it’s in, lots of people eventually find that barely making it day to day is starting to become more difficult. The majority of people in America lived salary to salary currently, as well as a large amount of families had both parents working to pay bills. Along with joblessness rates jumping and also reduces in time and compensation, the typical household is actually getting a lesser amount of when compared in years past – without decrease in their own general financial debt. As a result, an increasing number of folks are seeking in the direction of personal bankruptcy as their particular hope for relief.

Sad to say Chapter 7 and Chapter 13 bankruptcy rules are extremely complicated to understand. Presently there are certain rights, disclosures, addendums as well as procedures within the laws and regulations that are around bankruptcies. Just like with salary taxes, they are created in complicated legal terms difficult for the typical person to understand. Almost everything one needs to understand to be able to file can be found on the web, but without pursuing the actual directions and specs as prepared an individual can perhaps incur penalties or maybe imprisonment because of this. That’s where working with a lawyer who specializes in this field isn’t just essential, but recommended.

While each of those chapters 7 and 13 apply to unique consumers in contrast to companies or corporations, Chapter 7 and Chapter 13 bankruptcy rules are different- one more reason why working with a lawful consultation is essential. Although an individual’s first opinion of the variations in between the 2 guide them to think that one is preferable to another, the actual laws and regulations themselves do not fine detail each situation- which means that there’s lots of interpretation included. Without a very good knowledge of exactly how each kind of personal bankruptcy will affect their financial responsibilities, one may select incorrectly- exactly where a lawyer might have assisted them make a decision that could have been in their benefit.

For instance, looking at the Chapter 13 bankruptcy rules, one particular might find that they should document with the court a plan to pay back their own credit card companies almost all or even a part of the cash that’s owed using upcoming income. This could falsely guide them to think that they have to deal with every creditor within the plan- as well as accept much more pay back than required under the protection of the law. Right after talking to an attorney, the individual would have discovered that they can easily get rid of any kind of unguaranteed debts that they don’t prefer to maintain, like credit cards. They might even make a deal on specific guaranteed debts, such as auto loans, to pay back what the automobile is currently valued instead of what’s remaining on the loan.

Although a few may decide to not pay an attorney because they can document alone, obtaining a free of charge legal consultation at the very minimum amount is smart. Chapter 7 and Chapter 13 bankruptcy rules tend to be complicated and there’s considerable time as well as effort required to be able to complete all of the needed documents for the court. In a consultation, a legal professional will make good sense out from the Chapter 7 and Chapter 13 bankruptcy rules and also assisted in the finishing of the necessary documents. Over and above arming them with this knowing, an attorney can easily recommend a person on what to state or not to state, as well as which form of personal bankruptcy enables them to maintain a larger amount of what they worked really hard to get.

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Joel Steinberg asked:




It used to be much easier to refinance/ buyout out of Chapter 13 bankruptcy. With the subprime lending crisis it is harder for the lender to sell subprime paper. As a result many lenders went out of business, and others no longer offer a Chapter 13 buyout. However a capable mortgage lender still has the ability to help many people buyout of a Chapter 13. The chances of being successful are increased if you a) have equity in your home, b) have at least a 12 month history of no late mortgage payments and c)have been in Chapter 13 for at least a yea

There are not many lenders who specialize in this type of loan, and it is likely that you will have more success if you find one that does specialize in bankruptcy related buyouts. The loan officer will guide you through the process. This will include coordinating with a Chapter 13 attorney to get court permission. In most jurisdictions, this is not an issue,and will be granted easily.

The benefits of getting out of Chapter 13 are many and include, lower monthly payments, speedier improvement of credit,and avoiding the expense of Chapter 13, and the hidden creditor costs and attorney fees that quickly mount up.

A competent Chapter 13 refinance specialist will help you navigate through all the Mortgage Verifications that are required. He or she will know the tricks of the trade and help navigate through issues you may have such as late payments on second trusts.

It used to be common for Chapter 13 refinance. buyouts to be fixed for inly two years. These programs have, for the most part been discontinued, and now the mortgage will usually stay fixed for at least 5 years.

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Jon Arnold asked:




When a consumer is considering bankruptcy, the usual way to file it is to use Chapter 7 bankruptcy but in some cases it makes more sense for the consumer to file under Chapter 13 bankruptcy law. All bankruptcies, regardless of which chapter is filed, are done under the jurisdiction and supervision of the federal bankruptcy court.

The consumer who files under Chapter 13 bankruptcy protection is shielded and protected from creditors who might otherwise file a separate lawsuit against the consumer to collect the outstanding debt owed. When a consumer files Chapter 13 bankruptcy, the debt from all creditors is consolidated into one debt, it drastically reduces and sometimes even eliminates interest payments, and in almost all cases, it lowers the total amount of money that the consumer needs to lay out each month.

One of the beautiful parts about this is that after you have notified the creditors that you have filed bankruptcy, Chapter 13 or any other chapter, they can no longer call you or send you threatening letters, which only serves to increase your stress level anyway. You are recommended to keep a notebook near your phone and note which creditors you told about your bankruptcy, noting date, time, creditor and the name of the person you talked with. If they persist in calling after being notified that you have filed bankruptcy, they are in violation of federal law and you may have the option at that point of bringing a countersuit against them for that violation. Believe me, they are well aware of that and do not want to risk it.

Now by looking at this explanation, if you have been doing research into your bankruptcy options, you may have noticed that Chapter 13 bankruptcy sounds very similar to the process of using a debt consolidation service. You are right, but there are some very distinct advantages and disadvantages of each. For example, a debt consolidation service charges a small fee for their services, where the total amount of that fee would probably be a bit more than you would pay for your Chapter 13 bankruptcy filings and legal fees. But then again, with a debt consolidation service, your credit score is maintained and the fact that you are using a debt consolidation service is frequently not even visible on your credit reports, whereas a bankruptcy filing is a huge neon sign on your credit reports for the next 7 to 10 years. Although everyone’s situation is different, it would seem that a debt consolidation service, even though costing a bit more, would have much fewer long term negatives. You should really compare both options with a good bankruptcy lawyer so you can make an informed decision about what is best for your circumstances.

So the bottom line is that a chapter 13 bankruptcy gives the consumer the opportunity to pay off their financial obligations in a timely manner. The amount that the consumer will pay each month is determined by the bankruptcy court and will be an amount determined by a close examination of the consumer’s sources of income. A trustee is appointed by the court and the consumer’s check each month is given to that trustee. In most cases, this must be a certified check or cashier’s check, so it is going to be a bit more hassle to get that kind of check each month and get it to the trustee.

If you are considering bankruptcy as a consumer, you can either file Chapter 7 or Chapter 13. But especially with the recent changes in the bankruptcy laws, filing bankruptcy is no longer a “do it yourself” process unless you are willing to get very familiar with the bankruptcy laws. Making a mistake in the complex procedures that have been established could easily end up costing you more than a bankruptcy lawyer’s fees.

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Benjamin Robert Ehinger asked:




If you simply cannot fulfill your obligations to your creditors, then you have the option to file for either chapter 7 bankruptcy or chapter 13 bankruptcy.

There is a voluntary bankruptcy, which is when you file for bankruptcy yourself, and there is an involuntary bankruptcy that is when your creditors are the ones that initiate the process of filing bankruptcy.

When it comes to voluntary bankruptcy there are two options. You can file for chapter 7 bankruptcy or you can file for chapter 13 bankruptcy. These are your options so you should know what you are doing before you file for bankruptcy.

When you file for chapter 7 bankruptcy and it is granted to you, then you will have to surrender your properties, or at least the ones that were not exempted by the law. These will be surrendered to the trustee who will liquidate them and use the money to help pay off your creditors. It does not matter if you own enough property to pay off the debts in full, they will still take the property and use as much as they can to help pay your creditors. After this process the debts will be discharged and you will not have to pay on them again.

On the other hand when you file for chapter 13 bankruptcy, it works the same except for one difference. You will have to satisfy some of the unsecured loans and other debts before they will be discharged. This will all depend on what the court decides and they will take into consideration your financial abilities in the future.

Depending on your situation and your debts will depend on whether you file for chapter 7 bankruptcy or for chapter 13 bankruptcy. Either one can be very helpful when you are so far in debt that any other option will not help.

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Marcus Peterson asked:




Bankruptcy is a legally declared inability of an individual or organization to pay creditors. During the course of a bankruptcy, a debtor may ask a court to dismiss the case. If the court finds that dismissal will not harm the creditors, ordinarily a court will grant a petition to dismiss a Chapter 7 or a Chapter 13 bankruptcy.

There are several reasons a debtor may prefer to file a Chapter 13 bankruptcy petition. The reasons include the debtor wishes to resolve certain debts that may not be discharged in a Chapter 7 bankruptcy. The debtor may also wish to protect certain cosigners on personal loans from being pursued by creditors for repayment or feels obligated to repay certain debts. The debtor may believe that future creditors will look more favorably on Chapter 13 reorganization than a Chapter 7 discharge. A debtor may be required to file a Chapter 13 bankruptcy if he or she has received a Chapter 7 bankruptcy discharge within the prior six years, or obtained a Chapter 13 bankruptcy discharge within the prior six years and has not paid off at least 70% of the unsecured debts and was subject to the discharge of a prior Chapter 7 or Chapter 13 bankruptcy filing within the prior 180 days, because the debtor violated a court order, or requested dismissal after a creditor sought relief from the automatic stay.

After filing a Chapter 7 bankruptcy petition, some debtors discover that they are better served by pursuing relief under Chapter 13. By filing an appropriate motion with the bankruptcy court, the debtor has an absolute right to convert the petition to a Chapter 13 filing, if the debtor has not previously converted a Chapter 7 bankruptcy to a Chapter 13 bankruptcy, and the debtor’s estate qualifies for Chapter 13 relief.

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James R Brown asked:




Luckily for many, there are lawyers who specialize in car repossession. But, they aren’t called “Repossession Lawyers,” they are called Missouri and Illinois bankruptcy lawyers. You see, bankruptcy attorneys can use the powerful federal law that created bankruptcy to stop the repossession of your car or even get it back after it has been repossessed, under certain circumstances.

Your creditors are legally allowed to repossess your car once you’ve missed two payments. Fortunately, a Missouri or Illinois bankruptcy attorney can stop this from happening with a Chapter 13 bankruptcy but you must act quickly. Your must contact a bankruptcy lawyer within 10 days from the date it was taken. Sure, some lenders may give you more than 10 days but, when it comes to your car, it is better to be safe than sorry.

Still thinking that bankruptcy isn’t the best option for you? If you do indeed decide to give your car up, you might be in just as much–if not more–trouble. If your car is sold at auction for less than you owe, you will have to pay the balance back to your lenders. Your creditors will stop at nothing to collect that debt–including harassing phone calls and garnishing your wages. On top of not having a car, these actions will make it much harder to pay back the debt.

Whatever it is you choose to do, remember to do it quickly. Here are a few steps you can take if your car has been repossessed or is in danger of being repossessed.

1. Take a long, hard look at your finances. If the financial situation that makes you unable to pay your car payment is temporary, then perhaps bankruptcy isn’t for you. But, as many Missouri and Illinois bankruptcy attorneys know, debt tends to have a snowball effect. It creates problems in every area of your life and usually has no foreseeable end.

2. Check on every option. Of course, you can always give the lender a call but, in this economy, so many others are doing the same that it may be ineffective. Don’t underestimate the power that Missouri and Illinois Chapter 7 bankruptcy has to change the financial future for you and your family.

3. Act quickly. Whether you decide to give up your car or you decide to save it (and yourself) from your creditors, decide soon. Waiting to take action can take you into a much harder situation to get out of.

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Jason Rodriguez asked:




Do you really need a consumer bankruptcy lawyer when filing for bankruptcy? To answer this question, you simply need to look at this situation. How important is the result of this bankruptcy filing for you and your family?You may prefer to try to go through bankruptcy alone.

Maybe you’re the type of person who likes to do everything by yourself in order to prove that you’re capable of doing so, or maybe you’re just trying to save a buck because you’re already strapped financially. This latter point is understandable, since anyone looking into bankruptcy is obviously in serious financial difficulties and doesn’t have a lot of extra money to be spending on legal fees.

Having said that, you need to realize that bankruptcy, at least a successful chapter 7 case, will wipe out your debt. Even a 13 case will reorganize your debt into a three to five year payment plan. In either case, you should have some serious breathing room in order to pay for your legal fees in the future. Of course, you should work out the details with your lawyer and possibly try to get some sort of payment plan from the law firm before taking on the case.

Is a consumer bankruptcy lawyer essential? We’re afraid so. With the recent changes in the bankruptcy code, the process is simply too complex for a consumer to do this without legal counsel. And it’s important that the attorney have experience in consumer bankruptcy cases. You don’t want someone who has mostly experience in business cases such as Chapter 11. You need someone who can help you with your particular circumstances and problems instead of just giving generic advice.

Listening to this simple advice and taking action can have great positive effects on your bankruptcy proceeding and thus the future for you and your family.

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Michelle Bery asked:




It is one of those words that can make your stomach drop. It creates images of fortunes squandered, homes lost, and dreams shattered. Bankruptcy affects millions of people every year, but with the help of bankruptcy lawyers it does not have to be a financial death sentence. In fact, bankruptcy lawyers help people survive bankruptcy every day, and with their expert help, individuals and companies can often be back on their financial feet within a few short years.

Individual bankruptcy is initiated one of two ways; either by the debtor or the creditor. In the case of the former, the debtor wishes to escape from oppressive debt and seeks a new start, while in the latter scenario the creditor wishes to recover assets from a creditor who is no longer solvent. In either case, creditors, with the help of bankruptcy lawyers, will usually exercise one of two options; Chapter 7 or Chapter 13 bankruptcy.

With the help of bankruptcy lawyers, individuals can assess their financial situation and pursue the bankruptcy option that affords them the best possible outcome. For some, Chapter 7 might be their only realistic option. Also known as straight bankruptcy, or liquidation, Chapter 7 bankruptcies allow the debtor to keep some property while non-exempt property is sold with all proceeds going toward the creditors. In the process, many other debts are discharged, while some remain – such as child support, taxes, legal fines, and many student loans, to name a few. In many cases the creditors have very few assets that are eligible for liquidation. In those instances, bankruptcy lawyers may suggest Chapter 7 because it will allow the creditor to start over quickly with minimal losses of personal assets.

Some creditors have much to lose – such as a home or automobile – and they would like to avoid losing them. In that case, bankruptcy lawyers may advise their clients to pursue Chapter 13 bankruptcy. Also known as reorganization, Chapter 13 bankruptcy allows a creditor to repay some or all of their debts, usually under more favorable terms such as less interest and waived fees. However, it is more difficult to qualify for Chapter 13 protection because the creditor must have sufficient disposable income to qualify. With the help of bankruptcy lawyers, debtors in Chapter 13 arrangements have three to five years to pay their creditors while enjoying the protection of the bankruptcy court – the creditor cannot make ongoing attempts to collect on the original debts during this time. However, the debtor cannot obtain additional debt during this time, so both parties are restrained by the court.

If you are in serious debt and are facing bankruptcy or foreclosure then you should immediately consult with competent bankruptcy lawyers. The details and qualifications for all forms of bankruptcy – including some not mentioned – are very complex and require expert counsel that only qualified bankruptcy lawyers can provide.

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