Chula Vista Chapter 13 Bankruptcy Attorneys
Repay Your Debts Over Time
If you live paycheck to paycheck, you likely know how easy it can be to fall behind on bills. A single unexpected cost like an injury or car trouble can significantly set you back, and before long, you may find yourself the subject of creditor harassment. It can be easy to feel powerless when you still have income yet are unable to manage mounting debt.
Our Chula Vista Chapter 13 bankruptcy lawyers at The Sexton Law Firm can help you overcome overwhelming debt. By filing for Chapter 13 bankruptcy, you can reorganize and consolidate your debts into manageable chunks determined by how much you can currently pay. Filing can also shield you from collections lawsuits, wage garnishment, foreclosure, and repossession. Our team can help you get the most out of a Chapter 13 bankruptcy and help you fight for a life free of debt.
Who Qualifies for Chapter 13 Bankruptcy?
Individuals who do not qualify for Chapter 7 bankruptcy can generally file for Chapter 13 bankruptcy.
To determine your eligibility for Chapter 13, you will need to show that:
- You are up to date on your income tax filings
- You are employed and have sufficient monthly disposable income. Take your current income and subtract expenses like transportation, food, and clothing to determine your disposable income.
- Your debts do not exceed the debt limit (419,175 for unsecured and $1,257,850 for secured debt, as of 2020)
- You have not previously filed for Chapter 13 in the last 2 years, or Chapter 7 in the last four years.
Under Chapter 13, the bankruptcy court will expect you to at least partially repay creditors using your disposable monthly income.
Is Chapter 13 Right for Me?
Deciding to file for bankruptcy can be a tough decision, and it may not be the right solution for everyone. For some people, it can be a viable means of taking control of their debts and helping them to move forward in life.
Chapter 13 can be a good choice if:
- You are not eligible for Chapter 7
- You are facing foreclosure and want to save your home
- You have a high amount of assets that are not exempt
- You have enough income to to repay your debts over several years
If you are wondering whether you should move forward with Chapter 13, feel free to contact our attorneys to discuss your debts.
What Happens in a Chapter 13 Bankruptcy?
The bankruptcy process for a Chapter 13 generally involves:
- Filing your bankruptcy petition and automatic stay: As soon as you file for Chapter 13 bankruptcy, you will benefit from the automatic stay, a court order that stops all creditor actions. Any foreclosures, collection lawsuits, repossessions, wage garnishments, and any other creditor contact must cease until the bankruptcy has concluded. These protections stay in place so long as you continue to make your court-ordered monthly payments and only left when your filing has been completed.
- Creating a repayment plan for your debts: The bankruptcy court will evaluate your current level of disposable income. Your outstanding debts will be consolidated into a single monthly amount that you will be expected to pay for a period of 3 to 5 years. Your monthly payment amount is determined by your level of disposable income, not the total amount that you owe.
- Completion of your payment plan and discharge: When you successfully complete your payment plan, the bankruptcy court will usually allow you to discharge unsecured debts. Unsecured debts include personal loans, medical bills, credit card debt, and utility bills.
Unlike Chapter 7 bankruptcy, Chapter 13 bankruptcy does not include a liquidation component. This means that you will not lose any property as part of the filing process.
What Is Not Discharged in Chapter 13?
You will not be able to discharge secured loans, like missed mortgage or car payments, as well as tax debt and student loans. However, some of your payment plan will likely go toward settling these obligations, and the discharging of unsecured debts can give you financial flexibility to catch up on other missed payments. You will also have several years throughout your bankruptcy to raise additional funds.
Ready To Help You Leverage Chapter 13 Bankruptcy
Filing for Chapter 13 bankruptcy can benefit many individuals who have become overwhelmed with debt. Our Chula Vista Chapter 13 bankruptcy attorneys at The Sexton Law Firm can help determine for which type of bankruptcy you qualify for and guide you through each step of the filing process. We can work to protect you from creditor harassment, stop foreclosures, and advocate for reasonable payment plan terms consistent with your disposable income.
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