Bankruptcy Chapter 13 in Denver
If you do not qualify for Chapter 7 bankruptcy or if your circumstances are better suited for Chapter 13, Benham Law, Inc. can help you move forward with your chapter 13 bankruptcy case. We are experts in weighing the pros and cons of Chapter 7 versus Chapter 13 and can ensure you make the right choice for your financial future.
Chapter 13 bankruptcy is often known as reorganization bankruptcy due to its use of a payment plan that allows you to pay a portion of your debt over time. The amount paid to your creditors in chapter 13 is generally much less than what you actually owe, Crafting a chapter 13 plan is very complex and depends greatly on your individual circumstances. It is vital to have an experienced bankruptcy attorney on your side to create the most advantageous chapter 13 plan for you.
Benefits of Filing Bankruptcy Chapter 13
While Chapter 13 bankruptcy takes longer and is often a more complex process than Chapter 7, it does have numerous advantages, including:
- The ability to stop foreclosure and repossession of assets
- Less time on a credit report; Chapter 7 bankruptcy stays on your report for 10 years, while Chapter 13 only stays for seven years
- Payments based on a monthly budget, significantly reducing your monthly debt payments
- The ability to remove certain liens from real estate through the process of lien stripping
- Possible reduction of car loan payments
- Ability to cure defaults on car loans and mortgages and still keep the property
- Ability to get rid of certain tax debts, and to pay non-dischargeable tax debt without incurring any new penalties or interest.
Chapter 13 Eligibility
If you are considering filing for Chapter 13 bankruptcy, there are a few qualifications you must meet before proceeding:
- Total debt: To file Chapter 13 bankruptcy, you have to meet debt limitations. Debt limitations change every three years. Currently, unsecured debt cannot exceed $394,725 while secured debt cannot exceed $1,184,200.
- Your household income: You must have adequate income to repay creditors at least in part.
- Your filing status: You must file for bankruptcy as an individual; business entities are not eligible for Chapter 13.
Chapter 13 Bankruptcy Discharge Process
When you are ready to file for Chapter 13 bankruptcy, a dedicated attorney from Benham Law, Inc. in South Metro Denver, will be by your side to walk you through the process.
First, you will be required to complete a credit counseling session. Then, your attorney will help you prepare your bankruptcy petition and a proposed plan for paying your creditors. Again, which creditors need to get paid and how much is complex and best determined by an experienced bankruptcy attorney.
After your Chapter 13 case is filed the court will appoint a trustee to act in the interest if your creditors. The trustee will review your proposed plan and make sure everything is compliant with the law. The trustee might object to your proposed plan and if so, your attorney will negotiate with the trustee to resolve any objections. Once your bankruptcy case is filed, an automatic stay goes into effect that stops creditors from all collection activities, including phone calls, letters, lawsuits, garnishments, etc. Within a month of filing your chapter 13 bankruptcy plan, you will have to begin making plan payments.
Approximately 30 days after your case is filed, you will attend a meeting of creditors where the trustee and creditors can ask you questions about your case. You might need to attend a confirmation hearing with the judge to determine if your proposed plan is acceptable. Eventually, your plan will be confirmed and you will proceed with plan payments.
Sometime over the life of your chapter 13 plan, you will be required to take a personal finance management class. If you successfully make all plan payments and adhere with all plan provisions, the court will grant a discharge and close your case.