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What are the Basics of Chapter 13 Bankruptcy?

Of the many forms of bankruptcy available in the United States the most commonly filed are Chapter 7 and Chapter 13 bankruptcies.  In certain cases bankruptcy can help people manage or even eliminate their debts as well as help provide a better financial future. Bankruptcy can stop foreclosure repossession, collection calls, and even lawsuits against you. Because the different types of bankruptcies are fundamentally different it is important to consult with a lawyer who understands bankruptcy law and can advise you about how best to improve you financial situation. To determine which type of bankruptcy would most benefit you, you should consult with an experienced Chapter 13 bankruptcy as soon as possible.

Chapter 13 bankruptcy is a type of bankruptcy that allows a person to reorganize their debts in way that makes them more manageable. One of the main benefits of Chapter 13 bankruptcy is that it allows you to keep your property during the reorganization period. This is significantly different from a Chapter 7 bankruptcy in which all non-exempt assets are liquidated to pay back creditors. There are various eligibility requirements for Chapter 13 bankruptcy. You need to be able to show the court that you will be able to make regular payments under a reorganization plan. You will also have to demonstrate that your total debt burden is not too high. If the court accepts your bankruptcy petition you will enter into a Chapter 13 repayment plan which determines how much you will pay each month towards your debts. Certain debts are considered “priority debts” which means that they must be paid in full. Priority debts include things like tax debts, child support, alimony, or wages owed to employees. Also included in your repayment plane are payments on secured debts such as your car loan or mortgage. The length of the repayment plan depends on a variety of factors and an attorney will need to review your circumstances to determine how long it will last in your case.

If you are facing financial difficulty and do not know where to turn bankruptcy may be able to help. Whether bankruptcy is right for you depends on your circumstances and an experienced bankruptcy attorney can help you decide what course of action to pursue.

To schedule a free consultation with Brent Westbrook call our office today at (636) 493-9231 or fill out the online contact form available on the right side of this page.