Many people are stuck with trying to catch up with their debts, but they cannot seem to get ahead. Some people are even using their credit cards to pay on other credit cards, and they are digging themselves deeper into debt. Many times, people are sacrificing eating food and other necessities to keep up with a house or car payment. As a Columbus, Ohio bankruptcy attorney, I have the experience to provide you the help you need to get control of your life again.
A Ch. 13 plan helps you repay some of your debts. In the plan, you are allowed a reasonable amount of living expenses, and you pay back only a portion of your debt in the plan, depending on your disposable (or left over) income.
A Ch. 13 plan involves the repayment of a portion of your debt over 3 to 5 years from your leftover disposable income. For all practical purposes, a Ch. 13 is commonly known as the debt repayment plan. There is also a Ch. 11 Bankruptcy, but this is not generally applicable to the average consumer.
A Debtor is a person filing for Ch. 13, and the case is administered in court through a trust. A trustee is appointed on behalf of the debtor's creditors to Administer the Case, investigate, and recover any Assets of the Estate (like real estate, automobiles, clothing, jewelry, Tax Returns,and other assets) for the debtor's creditors. A debtor has a Ch. 13 Statutory Limit on the amount of debt they may have to qualify for a Ch. 13 bankruptcy. 11 U.S.C. § 109(e).
When a person files a Ch. 13 petition, they are protected under federal law by a federal Stay Order. The stay order has the effect of stopping all state law proceedings, including any lawsuits or collection efforts.
In a Ch. 13 plan, the debtor needs to account for all the equity available (beyond the statutory exemptions) in the estate and repay that amount of equity in the best interest of the creditors.
When a debtor files a Ch. 13, the debtor agrees to Repay a Portion of the debts that they owe. Eligibility for a Ch. 13 is determined by the amount of unsecured and secured debt. The Repayment Plan includes all unsecured and secured debts that are owed based on creditors filing a Proof of Claim, including taxes, child support, credit cards, and other bills.
The Confirmation Hearing has the Effect of Confirming the Plan or pointing out issues that need resolved with the Plan. Plans can be Modified Prior to The Confirmation Hearing or After the Confirmation Hearing. Confirmation can be revoked if Fraud is involved.
The main advantage of a Ch. 13 is the debtor is able to catch up their car or house payments through the Ch. 13 plan. The Plan may also Cram Down a car loan value to fair market value if the car was purchased greater than 910 days. If the car was purchased within 910 days, the debtor will need to use the contract rate.
If a Ch. 13 Plan fails (usually for lack of payment), the case is Dismissed. Sometimes a case can be Converted to a Ch. 7. If the plan succeeds, there is a Discharge upon the completion of the Plan. Even if only a portion of the unsecured debts are repaid, the remaining balance of debts is eliminated through discharge, except child support, student loans, and taxes.
In my free initial consultation, I assess what is going on with a client and determine if I can help them with a Ch. 13. My attorney fees are based on the complexity of the case, but I try to competitively price my attorney fees in a reasonable, affordable, and efficient way. Please call me to set up a free initial consultation to learn about bankruptcy:
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