The benefits to a Chapter 13 Bankruptcy are numerous. First, you're have the ability to keep your money and assets. Second, you'll be able to catch up on any payments you’ve fallen behind on over a 3 to 5 year period. Third, you can stop foreclosure and garnishments and take care of the underlying delinquincy through you Chapter 13 Plan.
You'll have a role in developing your plan alongside your attorney. You may also be able to modify the terms for repaying some of your secured debts, except the mortgage for your primary residence, and you can unburden yourself from having to repay part of or all of your unsecured debt, similar to a Chapter 7 Bankruptcy. Chapter 13 Bankruptcy also provides protections for any co-signers who may have helped you get a loan that you're dealing with in your bankruptcy.
Here are some additional considerations if you're thinking about filing a Chapter 13 Bankruptcy.
Is a Chapter 13 Bankruptcy right for me?
Chapter 13 bankruptcy is ideal for people who don’t qualify for Chapter 7 because their income is too high, people who are behind on their mortgage or car payments, as well as people who have varied assets they wish to protect. As part of your Chapter 13 bankruptcy, you’ll enter into a repayment plan that can include reduced principal and interest, partial repayment, and complete elimination of certain debts.
What Happens if I file a Chapter 13 Bankruptcy?
Filing for Chapter 13 bankruptcy stops collections, garnishments, repossessions, and foreclosures the same day you file for bankruptcy. You get a chance to regroup financially without being hounded by debt collectors during the bankruptcy process. Chapter 13 bankruptcy gives you the opportunity to get rid of unnecessary debt, rebalance your budget, and repay the majority or your debt. After your Chapter 13 bankruptcy is over, you won’t be liable for any debt that is discharged in bankruptcy.
How Much Does it Cost to File a Chapter 13 Bankruptcy?
There are 2 common costs associated with Chapter 13 bankruptcy: (1) a filing fee and (2) an attorney’s fee. The filing fee for a Chapter 13 bankruptcy in the Western District of Texas is currently $313. Attorney’s fees for a Chapter 13 bankruptcy are set by the District Court where you file, which is determined by where you live, and are paid through the repayment plan. If you’re filing a routine, non-business Chapter 13 in Austin your attorney’s fee will be $4,500, in Waco or San Antonio your attorney’s fees will be $4,100.
How Long Does a Chapter 13 Bankuptcy Last?
Your Chapter 13 Bankruptcy will continue through the end of your plan, which will be 3 to 5 years. You’ll also spend time with your attorney preparing your case to be filed, and there may be reasons that your attorney will explain why this process may take longer than just a few weeks. We discuss the details of your situation and develop a plan that provides you with the most protection and benefits from your Chapter 13 Bankruptcy. Give us a call today to schedule your free consultation.