Mount Vernon Chapter 13 Bankruptcy Lawyers | Stop Home Foreclosure | Chapter 13 Bankruptcy Attorneys in Mount Vernon, WA | Stop House Auction
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A Chapter 13 bankruptcy is a form of bankruptcy where your debt is consolidated into a payment plan that lasts three to five years. Unlike non-bankruptcy payment plans, you can include all kinds of debt in a Chapter 13 – taxes, car loans, missed mortgage payments, parking tickets, back spousal maintenance and child support – all debt gets included in the plan.
Some debt you have to pay in full, such as more recent back taxes and child support. Some you pay according to how much you can afford. For car loans taken out over two and a half years ago, you can pay the amount the car is worth.
First mortgages must be paid in full but if your house is worth less than the amount of the first mortgage, a second mortgage can be removed from the title of your house in a Chapter 13. If you surrender a house or a car, you do not have to pay the whole loan – you may pay nothing.
If your license is suspended for unpaid tickets, you can reinstate your driver’s license by filing a Chapter 13. This is not an option in a Chapter 7.
If your household income is more than the average income for a household of your size, you may have to file a Chapter 13. For higher incomes, a debtor has to go through a means test. The means test deducts certain expenses set by law and certain expenses you actually incur to determine what bankruptcy law says you should be able to afford to pay into a Chapter 13 plan.
The plan will include secured debts, such as back mortgage payments and car loans, priority debt like taxes and back child support and general unsecured debt. The general unsecured debt is the last in line to get paid. You can pay as little as 0% of your general unsecured debt in a Chapter 13. Even if you end up paying 100% of your general unsecured debt, a Chapter 13 plan is more secure, predictable and organized than other types of debt consolidation.
Any unsecured debt that is not paid in a bankruptcy is discharged as long as the law allows a discharge. Student loans can not be discharged. Taxes and back child support cannot be discharged but has to be paid in the plan. Even if a debt can not be discharged and is not paid in the plan, you do not have to make any payments on that debt while you reorganize. Some debts, such as debts a spouse is ordered to pay for another spouse in a divorce, can be discharged in a Chapter 13 but not a Chapter 7.
Another benefit of Chapter 13 is the ability to keep property that could be lost in a Chapter 7. Though losing property in a Chapter 7 is rare, it does happen. If you pay your unsecured creditors the amount they would have received in a Chapter 7 over five years, you can keep the property in a Chapter 13.
A Chapter 13 bankruptcy is a form of bankruptcy where your debt is consolidated into a payment plan that lasts three to five years. Unlike non-bankruptcy payment plans, you can include all kinds of debt in a Chapter 13 – taxes, car loans, missed mortgage payments, parking tickets, back spousal maintenance and child support – all debt gets included in the plan.
Some debt you have to pay in full, such as more recent back taxes and child support. Some you pay according to how much you can afford. For car loans taken out over two and a half years ago, you can pay the amount the car is worth.
First mortgages must be paid in full but if your house is worth less than the amount of the first mortgage, a second mortgage can be removed from the title of your house in a Chapter 13. If you surrender a house or a car, you do not have to pay the whole loan – you may pay nothing.
If your license is suspended for unpaid tickets, you can reinstate your driver’s license by filing a Chapter 13. This is not an option in a Chapter 7.
If your household income is more than the average income for a household of your size, you may have to file a Chapter 13. For higher incomes, a debtor has to go through a means test. The means test deducts certain expenses set by law and certain expenses you actually incur to determine what bankruptcy law says you should be able to afford to pay into a Chapter 13 plan.
The plan will include secured debts, such as back mortgage payments and car loans, priority debt like taxes and back child support and general unsecured debt. The general unsecured debt is the last in line to get paid. You can pay as little as 0% of your general unsecured debt in a Chapter 13. Even if you end up paying 100% of your general unsecured debt, a Chapter 13 plan is more secure, predictable and organized than other types of debt consolidation.
Any unsecured debt that is not paid in a bankruptcy is discharged as long as the law allows a discharge. Student loans can not be discharged. Taxes and back child support cannot be discharged but has to be paid in the plan.
Even if a debt can not be discharged and is not paid in the plan, you do not have to make any payments on that debt while you reorganize. Some debts, such as debts a spouse is ordered to pay for another spouse in a divorce, can be discharged in a Chapter 13 but not a Chapter 7.
Another benefit of Chapter 13 is the ability to keep property that could be lost in a Chapter 7. Though losing property in a Chapter 7 is rare, it does happen. If you pay your unsecured creditors the amount they would have received in a Chapter 7 over five years, you can keep the property in a Chapter 13.