Chapter 13 bankruptcy is a court-approved repayment plan that helps debtors manage debt obligations in 3 to 5 years. Many debtors that feel overwhelmed with making monthly payments can have their obligations restructured so they are easier to pay. This is a great option that offers a variety of benefits with many debtors enjoying multiple advantages.
Benefits of Chapter 13 Bankruptcy
The following points provide additional insight on how Chapter 13 bankruptcy can work for you:
You want to keep your home after falling behind on your mortgage. You can get caught up on missed payments and avoid foreclosure.
Protect non-exempt property. This may be property that would not be eligible for protection under Chapter 7 bankruptcy.
Prevent repossession of your vehicle and catch up on loan payments. Debtors may be able to “cram down” car payments based on the current value of the vehicle and original principal amount of the loan.
You recently filed Chapter 7 bankruptcy. If you filed bankruptcy within the last 8 years you may be able to get protection through Chapter 13.
You owe back taxes that are not eligible for discharge. If you have more recent tax obligations you can get them paid through an affordable repayment plan based on your ability. The Internal Revenue Service (IRS) will stop collection attempts and be forced to accept payment in whatever amount agreed upon the bankruptcy court.
Need an affordable repayment plan you can handle. If you have obligations such as student loan debt you can include them in your repayment plan.
Protect cosigners. If you have debt with a cosigner they may be pursued by creditors if you file Chapter 7.