Chapter 13 Bankruptcy Questions and Answers
1. What is Chapter 13 Bankruptcy?
2. Should I file Chapter 13?
3. Who can file Chapter 13?
4. How are taxes treated in Chapter 13?
5. Can property foreclosure be stopped?
6. How does Chapter 13 affect co-signers?
7. Must all debts be paid in full?
8. Do both spouses have to file?
9. Do I lose my property if I file Chapter 13?
10. How long does a Chapter 13 case last?
11. How much does it cost to file a Chapter 13 case?
What is Chapter 13 Bankruptcy?
Chapter 13 bankruptcy is a debt consolidation and repayment plan. Most of your debts are consolidated into a single payment made at regular intervals determined by the court. You are protected from creditors by the courts until your debts are paid and you are back on track for financial success.
Should I file Chapter 13?
Most clients who choose to file Chapter 13 have a regular source of income and have money left over each month after subtracting their basic living expenses. When you schedule your FREE consultation, Mr. Rhymer will discuss with you your options, based on your individual situation. In most cases your monthly payment to creditors can be reduced while you keep all of your property.
Who can file Chapter 13?
Chapter 13 is designed for those clients with a regular income. Your living expenses are subtracted from your income, and you pay the difference, your excess income, to the Chapter 13 trustee to distribute among your creditors.
How are taxes treated in Chapter 13?
In Chapter 13, you pay back taxes, most of the time without interest, in your payment plan. In some circumstances you pay only a portion of the taxes owed.
Can property foreclosure be stopped?
Chapter 13 debt consolidation stops foreclosure and back payments are paid in the payment plan and future regular payments are paid either directly to the mortgage company or in some cases paid through your Chapter 13 plan.
How does Chapter 13 affect co-signers?
All co-signers on consumer debts can be protected from creditors while the debts are being paid under a Chapter 13 plan by the person filing the case.
Must all debts be paid in full?
No. In certain cases, depending on your monthly income, expenses, and types of debts, you may pay back as little as zero cents on the dollar on most unsecured debts.
Do both spouses have to file?
Both spouses may file, but it is not a requirement that both file.
Do I lose my property if I file Chapter 13?
No. You can keep all of your property or you can surrender some of your property and keep other property, depending on the provisions of your Chapter 13 plan.
How long does a Chapter 13 case last?
A Chapter 13 case generally lasts from 3-5 years. A Chapter 13 case may not last longer than 5 years, but may be completed sooner than 3 years.
How much does it cost to file a Chapter 13 case?
The cost to start a Chapter 13 case varies depending on your individual situation. Chapter 13 protection can be started for as low as just the clerk's filing fee. The current clerk's filing fee for a Chapter 13 is $310.00. Most cases can be started for $310.00 in money order or cash. Many times if you cannot afford to pay the whole filing fee of $310.00 upfront you can pay $80.00 and pay the balance in payments. Most if not all of the attorney fees can be paid monthly through the case plan.
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