Bankruptcy Chapter 13 Reorganization

Chapter 13 bankruptcy can be classified as a restructuring bankruptcy. This is in contrast to Chapter 7, which is a liquidation bankruptcy.

You must give all non-exempt property in Chapter 7 bankruptcy to get most of your debts wiped out.

Must Read: https://www.lawlifetime.com/exempt-or-non-exempt-property/

Chapter 13 bankruptcy is different from the liquidation process. You won’t have to give up any property. Instead, you will need to create a structured repayment plan which outlines how your income will be used to repay your debts over time. This typically takes three to five years.

Eligibility for Chapter 13 Reorganization Bankruptcy

Before you think about filing Chapter 13 bankruptcy, it is necessary to prove that you are eligible. Chapter 13 bankruptcy is different from Chapter 7. Chapter 13 uses your income to pay your creditors. Chapter 13 bankruptcy is not available to you if your income is not sufficient or irregular.

You may also be prevented from filing Chapter 13 bankruptcy because of certain debt limits. Unsecured debt means that your creditor doesn’t have the right to take any item of property if the debt isn’t repaid. A secured debt, on the other hand, is where the creditor promises to pay the debt in full.

Never Miss: https://www.lawsuccess.us/bankruptcy-law/

Reorganization Bankruptcy Process

You must first get credit counseling from an agency that has been approved by the United States Trustee. These agencies may charge a fee for their services but they are required to offer free or very low-cost counseling to anyone who can prove that they are unable to pay. You will need to pay an additional fee for Chapter 13 bankruptcy filings.

Repayment Plans for Chapter 13 Reorganization Bankruptcy

The repayment plan is the most crucial and difficult part of a Chapter 13 bankruptcy. The repayment plan will detail how much you will pay each creditor to reduce your debts. While there is not a standard, accepted form, most courts have created their own forms that can be helpful in determining your repayment plan.

What amount do you need to pay?

You must include a plan for paying certain debts fully in your Chapter 13 repayment plan. These debts, also known as “priority loans”, are more important than others and can be added to your bankruptcy repayment plan. These debts can include taxes due and owing, as well as child support payments.

Also Read: https://www.valueslaw.com/bankruptcy-exemptions/

Your repayment plan must also include other items. You must include payments on secured debts such as car or home payments. These late payments must also be included in your repayment plan if you are behind on any secured debt payments.

The repayment plan must show that you have any income available after paying secured debts. This money can be used to pay unsecured debts. Although it may not be necessary to make payments if there is no disposable income, you must still show good faith efforts to repay your unsecured loans.

Length of the Repayment Plan

If your six-month average monthly income was higher than the state’s median income, then you must propose a five-year repayment plan. A three-year repayment plan will be offered if your income over the same period is lower than the state’s median income. Your repayment plan will terminate if all your debts are paid off before the end.

Failure to Make Payments on a Plan

You may find yourself in a situation where you are unable to pay your repayment plan. The bankruptcy trustee might be able modify your repayment plan to suit your circumstances if you lose your job or are unable to make payments on your repayment plan. If you are hospitalized for a prolonged period, and making payments on your repayment plan would be an undue hardship, a bankruptcy judge might decide to discharge your debts.

You may be able convert your Chapter 13 bankruptcy reorganization to a Chapter 7 bankruptcy liquidation bankruptcy if neither of these options were available. You can also ask the bankruptcy court for dismissal of your bankruptcy case. You would still owe all your debts and interest that creditors didn’t charge you during your bankruptcy proceedings.

Most Popular: https://www.dailylawstudy.com/debts-remaining/

The End of Chapter 13 Reorganization Bankruptcy

The bankruptcy court will wipe out all remaining debts if you stick to your repayment plan. Before a bankruptcy court can discharge your debts however, you will need to show that you have paid off all non-dischargeable debts. You also must prove that you have taken a budget counseling course through an agency approved by the United States Trustee.

Related Articles

Tips to prepare for your first consultation Immigration LAW

Tips to prepare for your first consultation Immigration LAW This is part 2 of a 3-part series about seeking legal immigration advice. This post will...

Steps to becoming a real estate lawyer

Steps to becoming a real estate lawyer Although a career in real estate law may seem exciting and lucrative, there are many steps to be...

8 Tips to Find a Reliable UK Immigration Lawyer

8 Tips to Find a Reliable UK Immigration Lawyer It can be difficult to find a trustworthy UK immigration lawyer. These are our top tips...

Reddit Legal Advice: 3 Tips for Evaluating Online Legal Advice

Reddit Legal Advice: 3 Tips for Evaluating Online Legal Advice Although it's possible to find the exact answer to your legal questions on the internet,...

Truck Accident Lawyers

Truck accidents are one of the most devastating events that happen to people, and when you're involved in one, you need the best legal...

What is Legal Information?

What is Legal Information? Any person who is familiar with the law can give legal information. This is different from legal advice. It's simply a...

High Conflict Divorce & Family Law

High Conflict Divorce & Family Law Alberta's legal system and judicial system have made significant progress in encouraging parties and their families to choose Alternative...

Here are some tips to help you choose the best criminal defense lawyer

If you are arrested or accused of a crime, hiring a criminal federal defense lawyer is the best decision you can make. You might...

A Certified Intimacy Coach and Educator offers advice on how to get your partner to sex after divorce

A Certified Intimacy Coach and Educator offers advice on how to get your partner to sex after divorce Some people are eager to get back...

Follow Us

1,000FansLike
1,000FollowersFollow
1,000FollowersFollow

Your Wellness and “Beauty Master”

Despite our busy lives, most people manage to find some time to care for...

Staying in Sync with Rights Owners: How to Clear Music for TV and Film

Are you creating a video, movie, commercial or video game? Have you ever wondered...

What Happens When A Victim Recants?

Not all criminal cases have a victim; however, in those that do, the alleged...

Types of “Hunting License Texas”

Hunting License Texas Resident A person who has been living in Texas for six months...

What is Personal Injury Law?

Personal Injury Lawyers The law of personal injury, commonly known as tort law relates to...

The Perth bogan behind “Ozzy Man Reviews”

Voiceover videos Ozzy Man Reviews He has a larger online following than any other high-profile...

Subscribe ⇘

spot_img
error: Content is protected !!