If you have decided, with the help of an experienced bankruptcy attorney, that filing for Chapter 13 is best for you, you are probably relieved to be moving forward but also brimming over with questions. From wondering what type of documentation will be required of you to whether you will have to go to court, undoubtedly you will be relying on your attorney for a mini education on bankruptcy. And by the end, most likely you will have one!
Like most potential filers, however, your first question is probably “what will I have to sacrifice?” This is an obvious question as you ask yourself whether or not the process of bankruptcy will be beneficial to you. In most cases, filing and completing a bankruptcy case beats the stress of wondering how you will manage to pay all of your creditors and will help you present a reasonable payment plan without worrying about collection actions from creditors.
While in Chapter 7, there could be issues surrounding assets like your home or car if they hold significant equity, in Chapter 13 you can keep your property while reorganizing your payments to creditors. This will require disposable income to do so—and most likely, that income what you will sacrifice.
Often known as the ‘income-based’ or ‘wage-earners’ bankruptcy, Chapter 13 allows you to pay back your creditors over a period of three to five years. This is a much more extended amount of time in comparison to Chapter 7 (usually up to six months) but does not require liquidation.
You may be able to lower numerous monthly payments in your bankruptcy plan, including but not limited to, debts such as vehicle loans, credit cards, medical bills, and other types of loans. Chapter 13 will help you protect your home from foreclosure as you continue to make payments on time, but also reorganize and catch up on any mortgage arrears. Chapter 13 also can help you keep a vehicle that was on the verge of repossession. You may find that you have little spending money for non-essentials like expensive vacations and retail therapy while in Chapter 13, but that can be a small price to pay for getting out of debt and putting your life back on track.
You probably have many questions about bankruptcy, from wondering how much you will have to sacrifice (very little in most cases), to whether you will have to go to court. Speak with a skilled bankruptcy attorney from the offices of H. Lehman Franklin, P.C. Call now to learn more at 912-764-9616, or contact us online.