Why would someone want to file a Chapter 13 bankruptcy case through a Third Lake bankruptcy attorney?Filing a Chapter 13 bankruptcy case will repay mortgage arrearages over the next three to five years and also allow you to reorganize all other types of debt. Chapter 13 is basically the type of case where someone is in foreclosure, they’re about to lose their home, they’re about to face a sheriff’s sale and they want to stop that sheriff’s sale.
When you file Chapter 13 bankruptcy, you basically tell the mortgage company that you are going to be able to make your regular mortgage payment on time once again and put a portion of the arrearage that you have through a Chapter 13 trustee over the next three to five years. The amount that you have to pay to a Chapter 13 trustee is based upon your income, your expenses, your assets, your liabilities and your total debt. Your Chapter 13 bankruptcy attorney will help formulate a plan whereby you can repay your arrears over time and continue to make your normal monthly living expenses outside of the Chapter 13 bankruptcy.
What typically happens is someone will fall behind on their mortgage payment due to an illness, injury or other event in their life that prevents them from being able to make that mortgage payment on time. They are able to correct whatever problem they’re having either by getting employed again or becoming healthy again or becoming better employed income-wise to the point where they can afford the regular mortgage payment on time once again. The mortgage company, however, has made a determination that you cannot make the mortgage payment, they are not willing to work with you and they want one lump sum payment to get caught up. Since you don’t have the one lump sum payment to get caught up, you either are going to file a Chapter 13 bankruptcy or you’re going to lose that home to a foreclosure sale.
Chapter 13 bankruptcy is another great opportunity for you to reorganize the debt when the mortgage company will not do a loan modification with you. If your mortgage company is being stubborn and they will not work with you in any regard, Chapter 13 forces them to work with you. Chapter 13 forces the mortgage company to take the regular mortgage payment on time once again. If you can make your regular mortgage payment plus put something away towards your arrearage, you are going to have a successful Chapter 13 bankruptcy case.
The Chapter 13 bankruptcy case also includes your car payment. So, if you are someone who has a financed vehicle and you are paying $500.00 a month for that vehicle, you can put that vehicle into a Chapter 13 and pay technically less than $500.00 per month.
So, in the situation where you’re saving a home and repaying a vehicle through a Chapter 13, you are, in essence, lowering the amount that you have to pay out per month because you’re stretching the debt over the next three to five years. Talk with a bankruptcy lawyer for help. Do not try to file bankruptcy yourself.