One of the most common questions I get as a knowledgeable bankruptcy lawyer in Littleton, Aurora, and Centennial, is: “What is the definition of Chapter 13 bankruptcy?” Today, we’ll discuss exactly what this form of bankruptcy is, and how it can help you and your family get on the right financial track.
The Definition of Chapter 13 Bankruptcy
This form of bankruptcy is found under Chapter 13 of the U.S bankruptcy law. Chapter 13 bankruptcy allows people to restructure their finances to create a repayment plan to pay back their debts. Its main advantage is that it allows people to keep their property.
Who Can File: Many different people can file for Chapter 13 bankruptcy in Highlands Ranch, Parker, and Lone Tree. These include those operating unincorporated businesses, the self-employed, and individuals. Partnerships and corporations are unable to file Chapter 13 bankruptcy.
The Process: Filing for any form of bankruptcy is a complicated process. These are basic steps; work with a skilled bankruptcy lawyer for best results.
The first step of the Chapter 13 bankruptcy process is to contact a Colorado bankruptcy attorney with experience. While it is possible to file on your own, the United States Bankruptcy Court advises against it. In the end, filing with a competent lawyer will get you the best fresh start possible.
The second step is to file a petition with the Denver bankruptcy court. In this petition, the debtor is required to provide tax and financial information, a list of creditors and debts, and proof that they have completed the required credit counseling.
The third step in the bankruptcy process is when the court will appoint an impartial bankruptcy trustee to your case. The trustee will meet with you and your creditors and will help you create a repayment plan, which is then presented to the court. Once the plan is approved by the court, you will make bimonthly or weekly payments to repay your creditors over 3 to 5 years.
The fourth step of the Chapter 13 bankruptcy process is the discharge. When you have completed your repayment plan, most of your debts will be wiped out (discharged). In reality, the discharge for Chapter 13 is even broader than the one for Chapter 7. This is because Chapter 13 allows certain debts (which are nondischargeable in Chapter 7) to be liquidated. Examples include some court fees, HOA fees, and various other kinds of debt.
The Benefits: Filing for Chapter 13 bankruptcy will give you a fresh start. You’ll be able to stop the harassment of debt collectors, wage garnishment, and the threat of lawsuits. This is because, when you file for bankruptcy, an automatic stay goes into effect which makes it illegal for debt collection agencies to attempt to collect. Also, when filing for Chapter 13 bankruptcy, you will be able to protect assets such as your home or car.
Struggling with Overwhelming Debt? Chapter 13 Can Provide Relief
If you are struggling with overwhelming debt, Chapter 13 bankruptcy can provide the relief you need. If you are considering bankruptcy as a debt relief option, contact me for a free bankruptcy consultation in order to determine whether Chapter 7 or Chapter 13 bankruptcy is right for you. Not everyone is eligible for Chapter 13; you must have a certain amount of debt, and you must have a regular income (Chapter 13 is often referred to as the “wage earners bankruptcy”). There are many nuances in bankruptcy law, which is why it is important to hire an affordable bankruptcy lawyer to work through your finances with you and guarantee you get the best fresh start possible.
Are you wondering whether your circumstances fit under the definition of Chapter 13 bankruptcy? Contact experienced bankruptcy attorney Barry Arrington for a free consultation at 303-205-7870.
He will help you get the best fresh start possible.