Have you ever wondered if the obligation of mounting debts totally submerges you under the water while you are seeking ways to get back a stable financial life? Hard times? Then you might think Chapter 13 bankruptcy is a viable solution.

 

The lawyers and Jefferson’s law firm staff understand that bankruptcy law is not easy to understand. So they work hard to provide some clarity to those who are Philadelphia residents and seeking bankruptcy help on the fear of being bankrupt. Today, we will thoroughly clarify whether Chapter 13 bankruptcy is a better option for you and spotlight how our inexpensive bankruptcy attorneys can be of use in making this journey easier for you. 

 

Understanding Chapter 13 Bankruptcy

 

In Chapter 13, the payers' equipment, known as the wage earner's plan, allows people with regular income to develop a plan to pay all their debts in full or in part within three to five years. Unlike Chapter 7 bankruptcy, which is a value-liquidation process, Chapter 13 bankruptcy restructured the debt period, so you may not need to liquidate your assets. 

 

The Pros of Chapter 13 Bankruptcy:

 

1. Asset Protection:

 

To help understand, saving the property is subject to the core benefit of Chapter 13 Bankruptcy Procedure. Posing an alternative to this case can enable you to sell back your property for an agreed sum that will help you clear your debts and save you from having to part with your property. 

 

2. Debt Repayment:

 

Filing Chapter 13 petitions brings the much-needed reprieve from debt emergency and channels all debts towards a systematic payoff plan. An important solution in this case is to have the loan company negotiate better conditions: lower interest rates and a longer maturity period. This enables you to pay back missed payments in small steps, one by one, until the debts are erased and you are debt-free. 

 

3. Foreclosure and Repossession Prevention:

 

When you're apt to foreclosure or repossess your property, the Chapter 13 bankruptcy proceeding might be the road to relief. By filing for bankruptcy, you can forthwith stop foreclosure proceedings. During a plan concocted by a bankruptcy judge, you can catch up on the missed mortgage and automobile payments, enabling you to stay in your house and drive your car. 

 

4. Co-Signer Protection:

 

What’s more is that if you have a co-signer to any loan, you could protect him from being taken to court by creditors by being the defendant yourself. As the filing law of automatic stay is issued, collection activities of creditors pursuing co-signers are blocked and relieved of it. 

 

5. Credit Score Recovery:

 

Although Chapter 13 bankruptcy must be disclosed on your credit report for up to seven years, it works as an opportunity for the discharge to demonstrate responsible financial behaviour by following the repayment plan stipulated. Continously, through the timely payments and arrangement of your affairs diligently, your credit score can improve gradually. 

 

The Cons of Chapter 13 Bankruptcy

 

1. Lengthy Repayment Period:

 

Different from Chapter 7 monetary bankruptcy, which usually frees a person from their debts within a few months, Chapter 13 earnings bankruptcy requires a person to be on a repayment plan that lasts for three to five years. However, some people may feel worried as they possess the loan within a fixed period, and their economic issues may worsen in their mood.

 

2. Strict Budget Requirements:

 

To be eligible to submit a Chapter 13 case, one should have consistent income because of their sources of income as they make repayments naturally. This is why you must allocate your finances wisely enough to make them last until you cover your recurrent expenditures. This step prevents overdue; instead, the plan is paid on time. 

 

3. Credit Impact:

 

Attaining the status of a Chapter 13 bankruptcy case might be your chance of getting better in the pool of troubled debts that form your credit record. Bankruptcy filings can be very frustrating, too, because they remain for many years and give you a bad name in your credit records, making you ineligible for further credit or reducing the interest rates. 

 

4. Limited Debt Discharge:

 

Chapter 13 bankruptcy allows the discharge of most unsecured debts compared to Chapter 7.  However, section 13 discharges were secured debt to be discharged upon completing the successful delivery plan. Some sorts of debts, such as student loans and tax liabilities, are usually waived in the process of Chapter 13 debt restructuring. 

 

5. Trustee Oversight:

 

Chapter 13 comprises two parts, the first is the court's role, which is to appoint a trustee who controls the plan.  Moreover, the trustee must watch over your financial situation. On the other hand, the trustee controls the structure and discipline, as you have to get his approval before you can do any major financial undertakings, such as selling a property or starting new credit. Despite this fact, however, this is also why you would eventually fail to freely make your major personal financial decisions since you would just act at the whim of your trustee. 

 

Get expert help from a Bankruptcy Lawyer in Montgomery County, Pennsylvania!

 

Chapter 13 bankruptcy filing poses a lot of problems and requires significant work, meaning that efficient legal guidance must be provided by skilled professionals. We at Jefferson Law LLC, have highly experienced, low-cost bankruptcy attorneys that help to handle the bankruptcy cases for individuals in Philadelphia.  Our team is committed to ensuring that our clients get a fresh financial start by using bankruptcy proceedings.

From screening you to see if you are eligible for Chapter 13 bankruptcy to punting a payback plan that will consider your needs, we'll move with you every step of the way. We are here to provide assistance, help you gain confidence in your financial skills, and eventually, allow you to exit the bankruptcy feeling energized and ready to begin afresh. 

 

Conclusion

Filing for a Chapter 13 bankruptcy can have an immense impact on people whose incomes do not meet their needs and find themselves sinking under the burden of unbearable debt by creating a debtor's estate that secures their assets, proving their condition of being able to pay, and lifting the threat of foreclosure and repossession. Yet, it's advisable to assess the balance correctly and seek direction from experienced Bankruptcy lawyers at Jefferson Law LLC to avoid haphazard decision-making.

If you are contemplating trying Chapter 13 bankruptcy in Philadelphia, we advise you not to hesitate to reach us for a consultation. In our counselling meeting, we will explore together your options for financial recovery and also design a plan that will lead you to a promising financial future.