If you are behind on your mortgage, car payments, or another secured loan, Chapter 13 bankruptcy gives you the opportunity to take control of your debt, without sacrificing your property.
The lawyers at Tom Bible Law have extensive experience filing and overseeing Chapter 13 bankruptcies. We can help you determine if Chapter 13 is right for you and equip you with knowledgeable representation throughout the legal process.
Do you plan on filing for bankruptcy or have questions regarding your debt relief options? Get in touch with our Chattanooga Chapter 13 bankruptcy attorneys to discuss your case. With offices in Chattanooga and Tullahoma, we accept clients from throughout Tennessee and North Georgia.
What is Chapter 13 Bankruptcy?
Some people refer to Chapter 13 bankruptcy as the “wage earner’s plan,” because it allows filers who earn a steady income to pay all or a portion of their debts over a defined period. Like with Chapter 7 bankruptcy, people who file for Chapter 13 receive an “automatic stay” from the court, which prevents creditors from foreclosing on their homes or repossessing their vehicles.
Here are some key features of Chapter 13 bankruptcy:
- Repayment Plan: Under Chapter 13, a debtor proposes a repayment plan to the court, outlining how they will repay their debts over an extended period. The plan typically includes monthly payments that consolidate and prioritize specific debts, such as mortgage arrears, car loans, or tax debts. Unsecured debts, like credit card debt, may be paid back at a reduced rate or possibly discharged in some cases.
- Debt Discharge: Once the debtor successfully completes the repayment plan, any remaining eligible debts may be discharged, meaning they are legally forgiven and no longer owed. This discharge provides individuals with a fresh start financially.
- Property Retention: Chapter 13 bankruptcy allows individuals to keep their property, including homes and vehicles, as long as they continue to make timely payments according to the court-approved plan. This feature makes Chapter 13 an attractive option for individuals who want to avoid foreclosure or repossession.
- Income Requirements: To be eligible for Chapter 13 bankruptcy, individuals must have a regular income that can support the proposed repayment plan. There are specific debt limits that apply, which may disqualify individuals with excessive debt from filing under Chapter 13.
It's essential to consult with a qualified bankruptcy attorney to understand the specific requirements and implications of filing for Chapter 13 bankruptcy. They can provide personalized guidance based on your financial situation.
Stripping Second Mortgages
Another reason people use Chapter 13 bankruptcy is to strip second mortgages. If you are “upside down” on your first mortgage, meaning you owe more than your house is worth, Chapter 13 can eliminate a second mortgage on the home. This is only possible if the house is your residence, and you currently have no equity in it.
How Much Is Bankruptcy Chapter 13?
The cost of filing Chapter 13 varies depending on factors such as attorney fees and the complexity of your situation. As of 2020, the filing fee is $313 for Chapter 13 (this includes a $235 filing fee and a $78 administrative fee) -- it is important to note that the fee is subject to change every few years, so be sure to visit the U.S. Courts site to learn about the most up-to-date filing fees.
If you opt to work with a Chapter 13 lawyer, that will also affect how much Chapter 13 will cost you. It will cost more, however, it will be beneficial in the long run. Bankruptcy is a convoluted matter and it’s a tussle between creditors seeking repayment and consumers claiming inability to pay.
If you lack experience in legal documentation or persuasive argumentation, even the smallest errors could lead to significant losses. A practiced bankruptcy attorney understands the necessary paperwork and crucial deadlines. They are familiar with the presiding judges and the arguments that will yield the desired outcomes. Incorrect completion of paperwork can also lead to catastrophic consequences. Mistakes are less likely when you work with an attorney but are commonplace for self-filing individuals.
Hiring an attorney significantly enhances your chances of success compared to attempting to file bankruptcy on your own. Consult with skilled Chapter 13 bankruptcy attorneys in Chattanooga to fully understand the costs involved with your filing.
Resolving Debt Through Chapter 13 Bankruptcy in Tennessee and North Georgia
Chapter 13 is a viable debt relief option for individuals and families who have fallen behind on home loans and other types of debt. It gives them the chance they need to catch up, reorganize their finances, and make their debts manageable.
It’s important to receive sound legal advice at each stage of the Chapter 13 bankruptcy process. Successful filings are not guaranteed. There are a number of situations that could lead a court to reject your petition or proposed repayment plan, leaving you to deal with debts and creditors.
At Tom Bible Law, our lawyers can negotiate with creditors and trustees on your behalf to secure more favorable repayment terms. We can also help you properly file your Chapter 13 petition and provide support during any 341 meetings, ensuring your interests are fairly represented. With over 18 years of experience, we have successfully handled countless bankruptcy cases (10,000+). You can trust us when we say that we’re determined to help you resolve your debt.
Call (423) 690-7712 to discuss your debt relief options with our Chattanooga Chapter 13 bankruptcy attorneys.