Are you overwhelmed by debt, but feel that you can’t qualify to file for bankruptcy? Maybe you haven’t hit financial rock bottom, but you need to have some reprieve from your creditors. Or you have valuable assets that you could lose if you filed for bankruptcy.
If this is your predicament, you might want to consider filing for Chapter 13 bankruptcy. Here are some things you need to know about this type of bankruptcy, and how Claeys, McElroy-Magruder & Kitchens Chapter 13 bankruptcy firm in Augusta GA can help you through it.
What is Chapter 13 Bankruptcy?
Bankruptcy, in the ordinary sense, is a legal procedure that offers relief to people who cannot meet their financial responsibilities. People usually turn to bankruptcy as a final resort to stave off creditors. Filing for bankruptcy can mean giving up all of one’s valuable assets so they can be liquidated and used to pay off debt.
Chapter 13 bankruptcy is, however, a unique type of bankruptcy. Here, the applicant acknowledges that they have more debt than they can currently pay, and asks the court for more time to get rid of it. The debtor will be assigned a court trustee with whom they work out a 3-5 year plan of how the debts will be paid off.
If your application for a Chapter 13 bankruptcy is successful, you will no longer have to deal with your creditors. You will remit the agreed sum of money to the trustee, who will then apportion it to each creditor.
Who Qualifies for a Chapter 13 Bankruptcy?
Chapter 13 bankruptcy only applies to natural persons. This could be an individual or a married couple. Legal persons, such as companies and businesses, do not qualify for this type of bankruptcy.
For you to qualify, you must also show the court that you have a steady source of income. Additionally, you must have filed all required federal and state taxes consistently for the past four years (some people are not required to file and that is fine!)
The bankruptcy laws require that you complete a credit counseling class before you can file a Chapter 13 bankruptcy. Claeys, McElroy-Magruder & Kitchens will help you find the right class for you.
Why Should I File for Chapter 13 Bankruptcy?
One of the critical advantages of filing for a Chapter 13 bankruptcy is that you can salvage your most valuable assets. For instance, if you have fallen behind on your mortgage payments and are about to lose your home, filing for Chapter 13 bankruptcy helps you avoid foreclosure. You can work out a more manageable 5-year repayment plan with the trustee. This will ease your financial pressure significantly.
Additionally, chapter 13 bankruptcy does not require that you liquidate your assets so that you can offset debts. Simply put, the money you use to clear your debts under a Chapter 13 bankruptcy agreement comes from your income and other revenue streams, not from the sale of your assets. This makes it an attractive option for those who have assets but still need more time to pay their debts.
Although filing for Chapter 13 bankruptcy can offer you some much-needed relief, you should take time to consider the downsides of this plan. For one thing, filing for bankruptcy can affect your credit scores. A Chapter 13 bankruptcy Augusta GA will remain on your credit report for seven to ten years. This can impact your ability to get loans or other financial services.
If your Chapter 13 application is successful, you will not be able to file for chapter 7 bankruptcy until six years have elapsed.
How to File for Chapter 13 Bankruptcy
Filing for chapter 13 bankruptcy can be an incredibly complex process due to the complicated nature of bankruptcy laws. In most instances, there are general rules and a multitude of exceptions. This is why you should seek the help of a Chapter 13 bankruptcy attorney in Augusta, GA.
A Chapter 13 bankruptcy attorney Augusta GA can help you to decide whether or not a Chapter 13 application is your best course of action. Once this is settled, they will then assist you in gathering all relevant documentation so that you can start the filing process. Some of the information required includes:
- Your source and amount of income
- A list of your assets
- A list of your creditors and how much you owe them
- A copy of your most recent tax returns
- Your living expenses
This information will help your Chapter 13 bankruptcy attorney Augusta GA create a repayment plan that is acceptable to the court. Our attorneys will also play a pivotal role in ensuring that your dealings with the court-appointed trustee are fair to you. We can shield you from burdensome repayment plans to ensure that the final plan relieves financial strain and still provides a practical way to get rid of your debts.
If you are worried about how you can afford to pay a Chapter 13 bankruptcy firm in Augusta GA while filing for bankruptcy, there is a simple solution. Attorney’s fees are part of your debts under a chapter 13 bankruptcy application. This means that you don’t have to pay them upfront. You pay them monthly as part of your chapter 13 payment.
Filing for chapter 13 bankruptcy can be a smart way to revive your financial life. This legal procedure provides you with leeway to repay your debts over an extended period, which can relieve an enormous amount of pressure.
If you want to file for bankruptcy, be sure to contact Claeys, McElroy-Magruder & Kitchens Chapter 13 bankruptcy firm in Augusta, GA. We will help you determine whether this is your best course of action given your unique financial circumstances. We will also guide you through the entire process to increase your chances of a successful application. Do not hesitate to reach out to us if you have any questions or concerns about this procedure.
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We are a debt relief agency. We help people file for bankruptcy relief under the Bankruptcy Code.