What is Chapter 13 Bankruptcy?
If you’re considering filing for Chapter 13 Bankruptcy in KY, the first step is to decide if it is right for your situation. Chapter 13 Bankruptcy is a repayment plan that offers distinct protections under the Federal Bankruptcy Code, allowing a debtor to reorganize debt and pay creditors in monthly payment arrangement. Chapter 13 bankruptcy is often referred to as a “wage earner’s plan” because a successful Chapter 13 requires monthly payments to an appointed trustee.
The Court will only confirm a Chapter 13 bankruptcy plan when a debtor can show that regular income or funds are coming into the household to make that monthly payment. The amount to be repaid monthly and the length of repayment vary greatly from case to case depending on the debtor’s income, expenses, and several other factors.
A Chapter 13 plan can restructure certain debts so that the debtor repays often under more favorable conditions, such as lower to no interest rates. Other benefits include the opportunity to remove qualifying liens from secured property, such as second mortgages or home equity lines of credit. In a Chapter 13 repayment plan debtors have the opportunity to keep property that may otherwise not have been protected under a Chapter 7 bankruptcy.
Find Debt Relief Through Chapter 13
In addition, for people that have fallen behind on their home loan or car loan, and may be facing an impending foreclosure or repossession, a Chapter 13 bankruptcy in KY may give immediate relief from those threats and make arrangements with those creditors.
Finally, a Chapter 13 may give clients an opportunity to resolve past due income taxes, sometimes with no future interest or penalties before they levy your wages at work, leaving you financially paralyzed.
Other factors affecting the decision to file a Chapter 13 include the ability to repay debts in the Chapter 13 plan that may not be dischargeable in a Chapter 7 bankruptcy. Examples of these non-dischargeable items include past due child support, taxes and student loans.
If you have any of these financial concerns, and think that a Chapter 13 may be right for you, time is of the essence and you need to meet immediately with an attorney to discuss your rights and remedies under the law.
Call us today at (502) 435-2593 to set up a free consultation with Attorney Tracy Hirsch to see if filing for a Kentucky Chapter 13 bankruptcy will help your specific situation.
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GSH LAW FIRM PLLC – Louisville Bankruptcy Attorneys