Why Chapter 13 May Be The Best Financial Tool.

Completing a Chapter 13 Bankruptcy can be difficult. Chapter 13 allows you to pay your creditors over a period of 36 to 60 months. The amount that you must pay is different for each case. However, the monthly payment is usually a lot less that what you were paying before bankruptcy.

There are many advantages and tools that can only be used in a Chapter 13. Here is a list of a few of the “tools” that are available and helpful to debtors in a Chapter 13. This is not everything since each person’s needs and circumstances are different.

1. Peace and Quiet: Stops creditor calls and harassment.
2. High Interest or Overvalued Vehicles: You only pay the current value on any vehicle purchased at least 2.5 years prior to the bankruptcy filing.
3. Stop Foreclosure: Keep your home and start back making your current house payment as well as a small additional payment to catch up the mortgage over 3 to 5 years.
4. Get Rid of A Second Mortgage: Another benefit of a Mississippi Chapter 13 is the ability to get rid of your second mortgage if your home is worth less than what you owe on your first mortgage.
5. Child Support or Alimony: Chapter 13 allows you to catch up child support or alimony support obligations over a longer period of time.
6. Co-signers are protected: Anyone who is a co-signor or co-debtor on one of your debts is protected from the creditors when you file bankruptcy.
7. Income Taxes: Income taxes that are over three years old can be wiped out and newer taxes may be paid out over the 36 to 60 month plan. You can become current on tax debts and emerge from bankruptcy with no debt to the IRS or the State of Mississippi Department of Revenue.
8. You Are Under Court Protection: Creditors are not allowed to call or contact you in any manner or to file lawsuits, foreclosures or garnishments. Any lawsuits, garnishments or foreclosures that have been filed are stopped.
9. Pay Less than you Owe: You usually pay back less than you owe to unsecured creditors. When you receive a discharge at the end of the Chapter 13 bankruptcy, the unsecured debt is wiped out even through it was not paid in full during the repayment plan.
10. Pay back Creditors: You may not consider this an advantage to filing a Chapter 13, but many people do want to pay their creditors at least something.

If you would like an evaluation of your financial situation and your debts, call us today at 601 948-1600 or email frankc@coxwelllaw.com, for a free consultation.

Disclaimer: This blog is intended as general information purposes only, and is not a substitute for legal advice. Anyone with a legal problem should consult a lawyer immediately.

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