Chapter 13 Bankruptcy

What is a Chapter 13 Bankruptcy?

A Chapter 13 Bankruptcy is sometimes called the “wage-earner’s plan” because it is an option available only to those who are actively earning an income. If you are earning enough, you can set up a repayment plan to pay off a portion of the debts and discharge the remainder.

First, under a Chapter 13 Bankruptcy, you develop a three- to five-year repayment plan, almost like a consolidation loan of your debts. Next, the court will set up a trustee to oversee the plan, and instead of paying your creditors, you give monthly payments to the trustee, who distributes the money to your creditors. At the end of the repayment plan, any remaining debts provided for by the plan are discharged.

Why Chapter 13?

There are several key advantages of a Chapter 13 Bankruptcy. First, the moment you begin Chapter 13 Bankruptcy, most collection actions against you automatically stop, including foreclosure proceedings against your home. Second, unlike some other types of bankruptcy filings that require you to liquidate, or sell, your assets, you can often keep your home if you make payments for the duration of the repayment plan.

Don’t Dive In Without Help!

However, as you might imagine, Chapter 13 Bankruptcy is a complex process, requiring you to supply financial documents and detailed lists of your assets to the court. You will have to attend hearings and meetings with creditors, the trustee, and the court. You don’t have to go through all of this alone. Kootenai Bankruptcy is here to help you. We are happy to explain this process, compile lists of your assets and legal obligations, represent you before a judge, and advise you on the course of action that works best for you.

Call us to set up an appointment for your free consultation. Each case is different, and so the consultation is your time to tell us your story, and our time to give you specific guidance as to how we can help in your situation. Don’t let debt keep you down; get a handle on it by giving us a call today.