By Greenville Bankruptcy Lawyer
John D. Compton, III
The United States Trustee describes Chapter 13 Bankruptcy (which must be read immediately prior to your initial consultation) as follows:
“Chapter 13: Repayment of All or Part of the Debts of an Individual with Regular Income ($235 filing fee, $75 administrative fee: Total fee $310)
“Chapter 13 is designed for individuals with regular income who would like to pay all or part of their debts in installments over a period of time. You are only eligible for chapter 13 if your debts do not exceed certain dollar amounts set forth in the Bankruptcy Code.
“Under chapter 13, you must file with the court a plan to repay your creditors all or part of the money that you owe them , using your future earnings. The period allowed by the court to repay your debts may be three years or five years, depending upon your income and other factors. The court must approve your plan before it can take effect.
“After completing the payments under your plan, your debts are generally discharged except for domestic support obligations; most student loans; certain taxes; most criminal fines and restitution obligations; certain debts which are not properly listed in your bankruptcy papers; certain debts for acts that caused death or personal injury; and certain long term secured obligations.”
This raises several questions which will be covered by your lawyer when you have an initial appointment:
- What amount of income disqualifies a debtor from filing Chapter 7 bankruptcy?
- What other factors make Chapter 13 the proper chapter for filing regardless of income?
- Do you have enough income to pursue a repayment plan?
- What debts make pursuing Chapter 13 rather than Chapter 7 the right option for you?
- How does a repayment plan work?
- How do creditors get paid?
- Are there any creditors that must be paid outside the repayment plan?
- If so, what kind of debt must be paid outside of the repayment plan?
- What happens if you’re laid off, your income is reduced or lose your job during the repayment period?
- How does the Court, and what factors are considered to approve the reorganization plan?
These and other information will be covered to fully inform you about the Chapter 13 process when you meet with an attorney. If you are having trouble keeping up with your bills – especially your house or car payments – you should seek the advice of a bankruptcy lawyer as soon as you can.