Keeping Your Home After Filing a Chapter 13 Bankruptcy in Fort Wayne
Here at Fred Wehrwein PC, among the most important cases that we represent are Chapter 13 bankruptcy cases. While bankruptcy cases are usually straightforward, there are a number of hurdles that you might need assistance in navigating. For instance, it’s possible to avoid foreclosing on your home when you file for Chapter 13 bankruptcy. However, a Chapter 13 bankruptcy attorney such as ours should be by your side to make sure that the legal process is completed without issue.
What Is Chapter 13 Bankruptcy?
This is a type of personal bankruptcy that provides individuals with the ability to repay part or all of their debts without going through liquidation, which means that you could avoid having to get rid of your assets. If your primary issue with repaying debt involves the time that you’re given to repay the debt as opposed to lacking income, this type of bankruptcy might be the best option for you as long as you seek assistance from a Fort Wayne chapter 13 bankruptcy attorney.
When an individual files for Chapter 13 bankruptcy, they will have anywhere from 3-5 years to resolve any of their outstanding debts, during which all disposable income will be used for debt reduction. As is the case with businesses that file for Chapter 11 bankruptcy, you will need to submit a reorganization plan for your debts that keeps your assets safe from foreclosure or repossession while at the same eliminating your other debts. Because of the intricacies involved with making such a plan, having a Chapter 13 bankruptcy attorney such as Fred Wehrwein PC by your side can go a long way towards mitigating any mistakes during the creation of the plan.
Benefits of Obtaining a Chapter 13 Bankruptcy
The two primary types of bankruptcy that are available to individuals include Chapter 7 bankruptcy and Chapter 13 bankruptcy. If you’re weighing your options, the main benefit of choosing Chapter 13 bankruptcy in comparison to its Chapter 7 counterpart is that Chapter 13 bankruptcy provides you with the ability to avoid foreclosing on your home when repaying debts. However, there are some guidelines that apply to this benefit, the primary of which is that mortgage payments must be made on time once Chapter 13 bankruptcy has been filed for.
Another notable benefit of choosing Chapter 13 bankruptcy is that individuals can reschedule their secured debts and extend them for a lengthy period of time. Because of the time extension allotted to you for repaying your debts, it’s likely that payments will be reduced. You’ll also find that Chapter 13 is outfitted with a provision that offers some protection for co-signers. Keep in mind that the plan created after filing for Chapter 13 bankruptcy requires you to make any outstanding payments to a trustee. The trustee will then send these payments to any creditors you still owe.
How to Avoid Foreclosing Your Home With Chapter 13 Bankruptcy
Losing a home because of filing bankruptcy is a frightening prospect for most homeowners. While you might be required to foreclose on your home if you file for Chapter 7 bankruptcy, it’s possible to avoid this issue with Chapter 13. The amount that you owe on your home is considered to be secured debt, which means that your home can be foreclosed on if you don’t make your payments on time. However, filing for Chapter 13 bankruptcy gives you the option of making mortgage payments during a period of 3-5 years.
It’s also possible that these payments could be free of interest, which means that everything you pay will be taken from the principal of the mortgage. Having more time to make these payments provides you with the opportunity to pay off your debt without losing your home. Keep in mind that late payments aren’t permitted with this plan. You will also have the option to increase your payments, which would allow you to get rid of the debt before the full 3-5 year period is finished. In the event that your financial situation worsens after you’ve filed for Chapter 13 bankruptcy, it’s possible to modify the plan.
Why You Should Hire a Chapter 13 Attorney
When you hire a Fort Wayne Chapter 13 bankruptcy attorney, they can help you create a sensible plan that can be submitted when you file for bankruptcy. This plan will allow you to repay your debts over a period of 3-5 years, which means that you can eliminate your debt. Without a bankruptcy attorney by your side, it’s possible that the plan you create won’t take everything into account, which could make it difficult for the plan to be approved by your creditors. Here at Fred Wehrwein PC, we can help you improve your financial future. Contact us today to schedule a free consultation.