Chapter 13 Bankruptcy Services

Chapter 13 Bankruptcy ServicesMacomb Bankruptcy Attorney, Daniela Dimovski, can file Chapter 13 bankruptcy for you if that is what you need

Chapter 13 bankruptcy is the reorganization of some or all of your debt. There are several reasons people file Chapter 13 bankruptcy. STOPPING a home foreclosure or a car repossession are the main 2 reasons.   To stop a home foreclosure, you MUST file Chapter 13 BEFORE the sheriff’s sale. You should NOT wait until the last day since it may be too late. To save your house, you must have the ability to pay your mortgage. Currently, bankruptcy does NOT change your monthly mortgage payment, your interest rate, or the terms of your mortgage. It allows you to take all the payments you are behind and spread them over a 3 to 5 year period. You are required to pay your regular mortgage payment and something towards the total amount for which you are behind.

The amount of the monthly payment and the length of the repayment plan are based upon the following factors:

  • Monthly income of the person
  • Monthly expenses of the person
  • Amount and nature of the debt

The most common uses of Chapter 13 involve:

  • STOP Foreclosure
  • Repayment of mortgage arrears (back amounts owed on your home)
  • STOP Car Repossession
  • Restructuring of auto loans to save a vehicle

People also file Chapter 13 bankruptcy if they have more assets than they can protect.  Chapter 13 gives people the opportunity to keep those assets without losing them. You must repay  creditors an amount equal to what you cannot protect. Finally, if your income is considerably higher than your expenses, you will most likely have to file Chapter 13 and repay some portion of your debt.

Chapter 13 bankruptcy plans

The Trustee is the person the Court has assigned to collect the payments you send in so that they can pay your creditors. In your Chapter 13 bankruptcy plan, you will make a payment to the Trustee, depending on how you get paid. Once your case is  approved, the Trustee will pay your creditors at the beginning of each month. If you don’t make your payments to the Trustee, they cannot pay your creditors. FAILURE TO PAY YOUR TRUSTEE WILL LEAD TO THE DISMISSAL OF YOUR CASE, WHICH MEANS YOU WILL LOSE Chapter 13 BANKRUPTCY PROTECTION!!!!

Chapter 13 Bankruptcy ServicesA Chapter 13 bankruptcy case lasts from 3 to 5 years. The length of time is determined by your income. If you are below the median or average income, you qualify for a 3-year plan. If your income is above the median or average income, you MUST be in a 5-year plan. This means you will be paying more back since you will pay a percentage for 60 months (versus paying that amount for 3 years).

There are typically 2 kinds of debt we deal with in a Chapter 13 bankruptcy plan; secured debts and unsecured debts. Secured debts are debts that have a lien attached to them, like a house or a car. These debts usually are repaid in full. Unsecured debts are credit cards, medical bills, deficiencies, personal loans, etc. These debts can be paid anywhere from 0% to 100% depending on how much income you have left at the end of the month after paying reasonable and necessary expenses.

Clinton Township-based Michigan Bankruptcy Attorney Daniela Dimovski can help you with all of your Chapter 13 needs. Contact us today.

Review the Chapter 13 bankruptcy timeline