Chapter 13 works differently than Chapter 7 bankruptcy. Below are some of the benefits of Chapter 13 that you may want to consider when deciding what type of bankruptcy is best for you and your financial situation.
When you file for Chapter 13, it allows you to consolidate all of your debts into one monthly payment. This reduces the number of payments going out. Instead of paying for five credit cards, your car, and your house; it all comes in one monthly payment.
Imagine paying a fraction of the money that you pay in debt each month. That is what Chapter 13 can do. In certain cases, the court will allow you to pay as little as 10% of your unsecured debt. Unsecured debts are things like credit cards, medical bills, etc. The remaining 90% of the debt, in this case, would be wiped clean. In some cases, unsecured debt even be completely wiped away and not paid back at all.
When filing for Chapter 13, it allows you to stop a foreclosure on your house temporarily. While the details of your Chapter 13 are being worked out for your debt and payment arrangement, the foreclosure gets suspended. Your mortgage could become part of your monthly payment, which allows you to avoid foreclosure altogether. Just make sure to make all of your mortgage payments on time after your bankruptcy filing. Then, catch up on your payments and your home will remain yours.
If you would like more information related to the scenarios stated above, then it may be worth talking to one of our experienced bankruptcy attorneys. We will sit down with you (or visit with you virtually) and go over your debts and assets to determine which chapter is best for you and build a custom solution for you based on the bankruptcy chapter that is best for you.
If you find yourself wondering what life after bankruptcy would be like without all the debt hanging over your head, call Castle Law Office at 816-842-6200 to speak with an attorney. Or you can email us and schedule your free consultation.