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When Chapter 13 Bankruptcy is the Best Choice for Debt Relief

when-to-file-bankruptcy-chapter-13Chapter 13 bankruptcy is often the best choice of debt relief for individuals and families who don't qualify under another bankruptcy chapter or would be unable to completely eliminate their unsecured debt under the new bankruptcy laws of 2005. Chapter 13 can also be an excellent way to prevent foreclosure and repossession while restructuring your monthly debt payments into a supervised installment agreement.

Scura, Wigfield, Heyer & Stevens & Cammarota, LLP, can be your complete bankruptcy law firm. We serve individuals, families and business owners throughout New Jersey from our offices in Wayne, Hoboken, Hackensack & Newark, NJ. Contact us for a free initial consultation about how we can help stop the harassing phone calls and letters right away.

Free Consultation ▪ Chapter 13 Bankruptcy Attorney

Unlike many debt relief law firms, we handle all types of bankruptcy and can help you decide which option is best for you, including:

  • Chapter 13 debt reorganization
  • Chapter 11 reorganization for clients with a significant debt burden
  • Chapter 7 bankruptcy

By filing Chapter 13, you may be able to:

  • Eliminate much of your credit card debt and restructure remaining payments
  • Keep equity in your house and prevent mortgage foreclosure
  • Keep your car
  • Stop wage garnishment and tax liens

What is Chapter 13?

In a Chapter 13 case, the debtor puts forward a plan, following the rules set forth in the bankruptcy laws, to repay all creditors over a period of time, usually from future income. 

Most Chapter 13 cases are used by a person looking to save a home or real estate in a foreclosure. It gives the debtor the opportunity to either sell the home or become caught up on mortgage payments that have fallen behind. A person filing a Chapter 13 can propose a 60 month plan to cure or become current on mortgage payments. For instance, if you fell behind on $60,000 worth of mortgage payments, you could propose a plan of $1,000 a month for 60 months to bring those mortgage payments current. 

In addition, in a Chapter 13 repayment plan, if you have high credit card debt and are behind on mortgage payments, depending upon your plan you may be able to pay only 5% to outstanding credit cards. 

For example, if you owe $100,000 in credit card debt, you may be able to pay only $5,000 over a 60 month plan depending upon your situation. There are also trustee's commissions that can be easily calculated depending upon your plan payment. 

A Chapter 13 case may be advantageous in that the debtor is allowed to get caught up on mortgages or car loans without the threat of foreclosure or repossession and is allowed to keep both exempt and nonexempt property. The debtor's plan is a document outlining to the bankruptcy court how the debtor proposes to pay current expenses while paying off all the old debt balances. 

The debtor's property is protected from seizure from creditors, including mortgage and other lien holders, as long as the proposed payments are made. The plan generally requires monthly payments to the bankruptcy trustee over a period of three to five years. Arrangements can be made to have these payments made automatically through payroll deductions.

Contact us right away for Chapter 13 bankruptcy help. Stop worrying tonight.

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Whether you need to completely eliminate your debt through Chapter 7 bankruptcy, or need to reorganize your credit payments through Chapter 13 or Chapter 11, we are well qualified as a full-service bankruptcy law firm for people in these and other New Jersey counties: Passaic County, Hudson County, Essex County, Bergen County, Morris County, and Sussex County. Call us today at 973-870-0434 or toll free 888-412-5091.

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