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Filing a Chapter 13 bankruptcy can alleviate stress and eliminate debt for not only a corporation but an individual as well. Chapter 13 bankruptcy is essentially a repayment plan proposed by a debtor to his or her creditors in order to catch up and pay off debts that have fallen behind. Chapter 13 also can save your assets such as car and home and allow you to keep these assets and maintain payments on them, but at the same time, stretch the payments that have fallen behind over a period of three to five years. Do your research thoroughly when considering filing any type of bankruptcy to make sure that what you decide is the best plan of action for you or your business.
Those who want to consider filing chapter 13 bankruptcy should think about the following items. Those who may be behind on their mortgage payments or owe money to the IRS; if you have assets that you wish to protect and that would be liquidated under a chapter 7 plan; your disposable income is too high to qualify for a chapter 7 bankrupcty; if you need some relief from creditors yet wish to maintain the original payment plans with your creditors; you wish to leave chapter 7 bankruptcy as an option in the future; or if you have filed chapter 7 within the last six years, have a co-signor or have the capability to repay your indebtedness within three to five years.
Individuals will qualify for chapter 13 bankruptcy if the meet the following criteria: unsecured debt, ie credit card debt or debt for goods and services, may not exceed $250,000 and secured debt, ie home mortgages, vehicles loans, may not exceed $750,000. Payments are made to a trustee, who in turn pays secured creditors first in line with their priority placement and then unsecured or credit card debt may be paid as a second priority. Creditors are not required to agree to this type of bankruptcy repayment plan, as the court can force the creditor to accept even if they object.
If you are filing Chapter 13 bankruptcy you do need to consider the consequences. This type of bankruptcy will stay on your credit record for 10 years after the debts have been discharged. When filing chapter 13 bankruptcy, a trustee will be appointed to oversee your financial affairs and payments will be distributed to creditors by the trustee after recieving payment from the debtor. Bankruptcy may also cost you higher interest rates when attempting to get a loan in the future because it is reported on your credit. However, chapter 13 bankruptcy may be an alternative for an individual that has exhausted the avenue of consumer credit counseling.
One type of bankruptcy proceeding is filing Chapter 13 bankruptcy. This type of bankruptcy is termed "wager-earners" bankrtupcy because it is dependent upon the individual or corporation having a regular steady income. If you have too much disposable income or you have assets that you would like to protect, then chapter 13 bankruptcy may be the route for you to go. Chapter 13 bankruptcy is a type of repayment plan to eliminate the stress of immediate repayment to creditors, spreading the payback out over two to five years. This form of bankruptcy will put a nearly immediate end to creditors calling the household or business as well.
There are resources available to consumers who are contemplating filing chapter 13 bankruptcy as an alternative to seek resolution to unpaid, unsecured debt. Chapter 13 bankruptcy forms can be found online and are easily downloaded to be filled out and filed. Those considering filling Chapter 13 bankruptcy should be sure that the forms you purchase and fill out pertain specifically to your state, as state laws with regard to bankrutpcy can vary. If you have exhausted the alternatives to filing for bankruptcy, have a large amount of unsecured debt as well as secured debt, Chapter 13 bankruptcy may be a viable option for you.
|Sheri Ann Richerson|