Chapter 13 is a type of bankruptcy that allows you to use a repayment plan to get caught up on past debts. This is useful in a variety of scenarios, including dealing with the threat of foreclosure.
Chapter 13 May Help You Avoid Foreclosure
With Chapter 7, your assets are sold to pay off your debts to the lenders. With Chapter 11, you negotiate with your creditors to adjust the terms of your debts. Both options help to prevent the accumulation of additional debt and interest. However, they are not your only options.
Chapter 13 bankruptcy in New Haven, IN may offer a solution to help you pay off your debts and avoid foreclosure on your home. With Chapter 13, you do not need to liquidate your assets. It is also often a much less complex and expensive process as compared to filing Chapter 11 bankruptcy.
Chapter 13 Helps Consolidate Debts
When filing Chapter 13 bankruptcy proceedings, a trustee is appointed to manage your payments. There is no direct contact with your creditors. The trustee works with all your creditors to determine your required payments. This essentially works as a consolidation of your debts and allows you to repay your loans over a three- or five-year period.
Before you are eligible to file Chapter 13 bankruptcy, you must first meet certain requirements. This includes receiving credit counseling to help you get caught up with your debts. Chapter 13 is also not available for individuals who operate small businesses through partnerships or corporations.
If you want to learn more about bankruptcy options, contact the professionals at Fred Wehrwin, P.C. Experts can review your situation and help determine if you are eligible to file bankruptcy.
When your debts begin to pile up, it may become difficult to meet your financial obligations. Late fees and additional interest increase the challenge of paying off your debts. In these situations, you may want to consider filing bankruptcy. You can also connect them on Facebook.