A Fresh Start. . .
Chapter 13 is an interest free debt repayment plan through which you consolidate your debts over a three to five-year period. The creditors cannot collect from you during the term of the plan. Debts that are generally consolidated in a Chapter 13 are mortgage arrears, balances on vehicle loans, student loans, credit card debts, and other unsecured debts.
One important thing to remember about Chapter 13 is that you must be working or have a consistent source of income for your repayment plan to be approved by the court. Not only must you be able to pay for your monthly living expenses, but you must also be able to make a payment to the court to consolidate your debts.
Chapter 13 will stop a foreclosure any time prior to a Sheriff's foreclosure sale, and allow you to repay your mortgage arrears. You will still be obligated to make all future payments directly to the mortgage company, but they may not proceed with the foreclosure. Call us now because once the sheriff sells your home, there is nothing we can do to stop the sale. Or in a Chapter 7 you may eliminate most forms of unsecured debt such as credit cards, medical bills, and personal loans.
Although you may not eliminate student loans in a Chapter 7 bankruptcy, you can consolidate student loan debts with your other bills in a Chapter 13, and stop a collection action against you. We can stop the collection action and garnishments related to student loan debts.
Your cosigners get protection too-in fact the same protection that you receive under Chapter 13. Chapter 13 may protect your cosigners from collection activity while you are in your repayment plan.
Our law firm can use Chapter 13 to stop a finance company from repossessing your vehicle. The past due payments, along with the outstanding balance on the car loan, will be consolidated into the Chapter 13. The finance company cannot repossess your car, and you will not have to make a payment directly to the finance company. In some instances, we can even get your car back if it was recently repossessed.
Beware of Refinancing
If you have equity in your home, you can file a Chapter 13, protect your equity, and repay your mortgage arrears over time. Refinancing or taking out a second mortgage may just create an additional mortgage payment that you cannot afford. You should explore all your options. With our quality legal representation, you become aware of your rights, and become less vulnerable to people trying to take advantage of you in a time of distress.