One of the most common bankruptcies that debtors file is Chapter 13. It is a way of reorganizing an individual person’s finances. This type of bankruptcy involves the debtor proposing to the bankruptcy court for an affordable repayment plan to repay a portion of his or her outstanding debts and extend payments over a more reasonable payment schedule. These payment plans last anywhere from three to five years.

What Are My Benefits Filing Chapter 13 Bankruptcy?

In addition, Chapter 13 also provides the benefit of the automatic stay. The automatic stay is an injunction which prohibits creditors from bringing or furthering collection actions. Benefits also include:

  • Stopping wage garnishment,
  • Preventing an eviction,
  • Putting an end to creditors’ harassing phone calls and letters, billing, and lawsuits pending against you, and
  • Prohibiting creditors from foreclosing on or repossessing your property.


The Best Part?

If you are behind on your secured debt payments, Chapter 13 bankruptcy lets you avoid foreclosure or repossession by catching up on your missed payments through your repayment plan. While you cure your default, the automatic stay prohibits creditors from foreclosing on or repossessing your property. Importantly, it can also give a debtor the opportunity to remove, or “cram down“, secured debt on real property that is not actually supported by underlying, actual equity in the property.


Here’s The Catch…

If you have signed a contract and pledged an asset as collateral for a loan, it means that the loan is considered a secured debt. When you fall behind on payments, your lender is allowed to foreclose or repossess that asset.

However, after a debtor file for Chapter 13, the automatic stay immediately comes into effect and temporarily halts foreclosure actions that have been initiated against a debtor.

Begin Again and Call Today To Ensure a Secure Financial Future!

As an experienced bankruptcy attorney and litigator, I can help to guide you to a path of financial stability and a new beginning. Our goal is to provide exceptional service and superior results for every client. Call today for a free consultation and see if bankruptcy is right for you. Don’t go at it alone and seek the help you deserve!

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