Chapter 13 is a section of the Bankruptcy Code which helps certain qualified individuals, or small business owners that are not a corporation or partnership, who desire to repay their creditors but are undergoing financial problems. For example, filing a Chapter 13 bankruptcy allows an opportunity to pay off past due mortgage arrearages or car payments over 36-60 months, giving you time to catch up and keep your property.
Sometimes, this is referred to as a “mini Chapter 11” because you usually repay something to your creditors and you retain your property and make payments under a bankruptcy plan. Chapter 13 bankruptcy is a debt repayment plan for individuals. Often times, the repayment will range from zero to 100% of your unsecured debt.
Who may file Chapter 13 bankruptcy?
Only an individual with regular income who owes, on the date the petition is filed, less than $360,475 in unsecured debt and $1,081,400 in secured debts may file a Chapter 13 bankruptcy. The debts used to calculate these limits must be noncontingent and liquidated, meaning that they must be for a certain, fixed, or easily determinable amoun. They cannot be subject to any conditions or bona fide disputes. If they are legitimately disputed or not liquidated, then those amounts may not be factored into the debt limit calculations.
Since changes that became applicable in 2005, you may be required to do a Chapter 13 if your annual income exceeds the median income for the region where you are filing and if the “means test” shows you have more than $100-$167 per month to pay to your creditors. Also at that time, your allowable monthly expenses will primarily be whatever is allowed under local IRS guidelines.
What are the benefits of Chapter 13?
Chapter thirteen bankruptcy protects individuals from debt collection efforts; permits individuals to keep their real and personal property; and also allows individuals to repay their debts with reduced payments schedules.
Under Chapter 13 bankruptcy laws, you may be able to discharge debts that would be nondischargeable under other chapters, including marital dissolution equalization payments.
You may be able to get wipe out junior liens on real estate. If the fair market value of your property is less than the total amount owed to the 1st mortgage, then you can eliminate the security interest to any junior lienholders and treat them as general unsecured creditors in your plan (thereby being able to possibly pay them less than 100%).
Certain tax repayments can be made easier by virtue of elimination of interest payments.
Top Inland Empire Chapter 13 Bankruptcy Attorneys
At Reid & Hellyer, your Chapter 13 bankruptcy will be handled by some of the best Riverside bankruptcy attorneys in the Inland Empire and Southern California. Notably, Chapter 13 bankruptcy lawyer Mark C. Schnitzer has been recognized as AV rated by Martindale-Hubbell and recognized as among the “Best Inland Empire Lawyers” by Inland Empire Magazine. Mr. Schnitzer works within the firm of Reid & Hellyer, which has itself been recognized as one of the Best Law Firms in American by U.S. News & World Report and Best Lawyers.
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If you are in need of a California bankruptcy attorney, call Reid & Hellyer today and we will set you up with a Riverside Chapter 13 bankruptcy lawyer. An experienced Riverside bankruptcy attorney rated as one of the best in their field is waiting to assist you with your financial concerns.