3 Things to Know About Chapter 13 Bankruptcy
Many debtors are interested in bankruptcy to free them of overwhelming debts, but they do not want to face liquidation through Chapter 7 bankruptcy. Instead, these debtors may find what they are looking for in Chapter 13 bankruptcy. Unlike Chapter 7 liquidation, Chapter 13 bankruptcy helps a debtor set up a repayment plan that lowers their regular payments into something manageable.
At Greenway Bankruptcy Law, LLC, we understand how complicated bankruptcy proceedings may seem at first glance. However, with help from an experienced legal advisor, we believe that debtors can receive a fresh financial start. To learn more about Birmingham bankruptcy, contact a Birmingham Chapter 13 bankruptcy lawyer today by calling (205) 324-4000.
Understanding Chapter 13 Bankruptcy
When considering your bankruptcy options, it can be important to understand the following three facts regarding Chapter 13 bankruptcy.
#1: Chapter 13 Bankruptcy Focuses on the Debtor, Not the Creditor
When creditors call or collection agencies show up at your door, you often have little say in what repayment plans they are willing to offer. However, Chapter 13 can put this power back in your hands. If you draft a repayment plan that is approved by a bankruptcy trustee, you can set up a payment program that actually fits with your income.
#2: Chapter 13 Bankruptcy Protects You from Foreclosure
If your house is at risk of foreclosure, you may want to file for bankruptcy to prevent creditors from foreclosing. Chapter 13 bankruptcy sets up a protection known as an “automatic stay.” This stops foreclosure proceedings and can help you establish a repayment plan with a creditor before they seize your property.
#3: Chapter 13 Bankruptcy Can Lower Your Payments and Get Rid of Debt
Debts that are not attached to any form of collateral may not have to be paid in full by the end of a Chapter 13 bankruptcy repayment plan. As long as you have paid back what the creditor would have otherwise received under Chapter 7 liquidation by the time the repayment plan has expired, the debt will be considered paid.
For many debtors, Chapter 13 bankruptcy provides an opportunity to settle debts on terms that take the debtor’s financial limitations into account. To learn more about how bankruptcy may be able to help you, contact the Birmingham Chapter 13 bankruptcy attorneys of Greenway Bankruptcy Law, LLC, today by calling (205) 324-4000.