Chapter 13 Bankruptcy: A Lifeline for Drowning Debts
Your financial future can be better! At S&B Legal we have highly experienced Chapter 13 bankruptcy attorneys in San Diego who will analyze your case to determine if this is the best debt relief option for you. Consult us before making a decision.
What is Chapter 13 Bankruptcy?
Imagine that instead of paying each creditor separately, you can free yourself from an overwhelming debt with a payment plan tailored to your pocket, without interest or penalties for late payment, and with the added bonus of being able to keep the possessions you have worked so hard to acquire.
This is exactly what bankruptcy Chapter 13 is all about! A perfectly legal alternative with which, upon fulfillment of certain conditions, you can say goodbye to your debts with a payment plan tailored to your real possibilities.
The best part? Payment will not have to be immediate, but the payment term for Chapter 13 Bankruptcy is three to five years.
Chapter 13 Bankruptcy: Rules and Provisions
To obtain the benefits, you must be aware of the requirements for obtaining Chapter 13 Bankruptcy. Among the rules and provisions that must be met to opt for Chapter 13 or wage-earner bankruptcy are:
- Exclusively for individuals: companies cannot benefit from this plan
- Sufficient income?: you must prove that you are able to pay your debts and live at the same time. No tightening your belt to the last hole!
- Tailored terms: if your salary is below the state average, you must pay in three years, and if the salary is above the average, you will have five years to pay the debt.
- Full transparency: you must declare all your debts and assets.
- Second chances? Not in this case: if you were denied another bankruptcy less than 180 days ago, you will have to look for other solutions other than Chapter 13 bankruptcy.
- The amount of debt can affect you: There are specific debt amounts that determine when you can and cannot file for Chapter 13 bankruptcy, and they are adjusted every three years.
Understanding the pros and cons of filing for Chapter 13
Getting out of the financial mess of unpaid debts that put your peace of mind and property at risk is perhaps one of the greatest attractions of Chapter 13 Bankruptcy. But be careful! Before jumping into that pool, each situation must be carefully analyzed.
There are pros and cons that you should carefully analyze before making this decision, which, we repeat, should be advised by attorneys with experience in the matter.
As practical advantages of filing for Chapter 13 bankruptcy we can mention:
- Debt rescheduling and installment payments: the fact of adapting to the debtor’s real payment possibilities and being able to do so in installments is a great relief for the debtor. Safeguarded possessions and assets: You will generally be able to keep your possessions and assets while you pay, as the foreclosure proceedings will be stopped
- Away from creditors’ harassment: You will be able to breathe from the pressure of your creditors, they will not be able to contact you to demand payment of their debts.
- Your salary is protected: While Chapter 13 bankruptcy is active, your salary cannot be seized nor can creditors sue you.
- Third-party protection: Chapter 13 protects those people who served as guarantors of the applicant’s debt.
As disadvantages of a Chapter 13 bankruptcy, we have:
- More complex legal process: compared to Chapter 7, the process becomes longer and has more complexities.
- Failure to pay could affect you: you must comply with the monthly payment of the established installments, otherwise, you would lose the protections from seizure of your assets or salary. You won’t be able to take on new debt: Any debt you plan to incur, such as payday loans, personal loans, car loans, and quick repayments, must be approved by the court.
- Higher legal fees: You will pay more in fees if you file for Chapter 13 bankruptcy than if you file for Chapter 7.
- Your credit report will be affected: A Chapter 13 bankruptcy will appear on your credit file for at least seven years.
Contact S&B Legal and receive the best advice on Chapter 13 bankruptcy
If you want to be sure that you choose a competent legal advisor to guide you through the Chapter bankruptcy 13 application, you have come to the right place. Best Chapter 13 lawyers near me? At S&B Legal we will review your financial situation and, based on your debts, income, expenses and assets, we will study whether this is the most advisable option in your case.
You can request a free evaluation now or call 760-302-4652. With our experienced bankruptcy attorneys in San Diego, CA, on your side, you will be guaranteed the best advice from start to finish in your Chapter 13 bankruptcy process. We will do everything possible to ensure that your rights are respected and we will negotiate a realistic payment plan that will allow you to keep your assets. Free yourself from the traps and anguish of debt!
