Posted by admin | Posted in Bankruptcy Forms | Posted on 30-07-2010-05-2008
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Isabel Searie asked:
The primary goal of a Chapter 13 bankruptcy is to consolidate your debts and set up a manageable monthly payment. The plan is developed by undertaking an in-depth analysis of your current income, your current monthly expenditures, and your current debts. Chapter 13 bankruptcies are also often referred to as a “debt consolidation”, or the “wage earners plan”.
A Washington Chapter 13 bankruptcy plan is specifically designed to allow you to stop foreclosures and repossessions while allowing you to make up the back payments in a 36 to 60 month plan. In a Chapter 13, we can also consolidate other bills, such as your car payment, whereby you only pay the value of the car, and not the loan balance. Other debt that can be consolidated includes tax debts, student loans, and child support or alimony arrears.
A Plan for People Who Earn A Good Income but Simply Cannot Keep up with their Mortgage Payments?
In today’s economy, many people find themselves in an extremely precarious financial state. Many people earn a good living. But they are barely living month to month while falling increasingly behind on their monthly bills. If, despite your good job or higher than average income, you are still drowning in debt and see no way out, then a Washington Chapter 13 may be your best option to make a financial recovery. A Washington State Chapter 13 bankruptcy may also allow you to keep your house and car in spite of being unable to meet your current monthly mortgage or car loan payments.
The process of filing a Chapter 13 bankruptcy is considerably more complex than a Chapter 7 here in Washington State. In addition to the voluntary petition and related documents, filing a Chapter 13 also requires submission of a specific repayment plan that presents a feasible and plausible payment schedule. This repayment plan must specifically detail how you intend to make your monthly payments to the Trustee. In addition to the 341 meeting of creditors, you will also be required to attend another mandatory hearing, which is called a “confirmation hearing”.
At your confirmation hearing, your case goes before a bankruptcy Judge for final review and approval. Typically, it is not necessary for you to attend the confirmation hearing. We are able to simply appear on your behalf. Prior to the confirmation hearing, it is not uncommon for creditors to file objections to your plan if they have issues or concerns with your proposed repayment plan. In a number of cases, this requires that we respond to their specific objections on your behalf.
In nearly all cases, however, we are able to get your plan confirmed by the Judge at the initial confirmation hearing if you are current with your Chapter 13 payments to the Trustee, any amendments requested by the Trustee have been filed, and any objections filed by your creditors have been properly addressed and resolved.
Once your plan has been confirmed, all you have to do is make all your monthly payments under the proposed Chapter 13 repayment plan, and you will receive your discharge. There are frequently a number of motions filed by creditors, the Trustee, and by us as attorney, during a Chapter 13 case. Chapter 13 bankruptcies are quite complex and it is highly recommended that you not attempt to proceed without an experienced Washington State bankruptcy attorney.
Reduce or Eliminate Interest on Consumer Debt
Unfortunately, certain kinds of debt simply cannot be eliminated through a Washington State Chapter 13 bankruptcy. These include child support, student loans and most income taxes. Once you consumer debt is under control, however, and your outstanding interest is lowered or eliminated, many people find that a Chapter 13 repayment plan is reasonable and feasible.
Cynthia Mendez
Posted by admin | Posted in Bankruptcy Foreclosure | Posted on 24-07-2010-05-2008
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Zach Hamilton asked:
If you are facing foreclosure, you may have tried a variety of strategies that could allow you to stay in your home, such as a workout with your mortgage company, or even a federal program such as the Home Affordable Modification Program. But nothing has helped and you are falling further behind in your mortgage payments. Can declaring bankruptcy be the answer? Can bankruptcy stop foreclosure and allow you to keep your primary residence?
Chapter 13 Bankruptcy
Bankruptcy is a federal court process providing individuals or businesses the opportunity to either eliminate their debts or repay them. There are two most common types of bankruptcy. Under a Chapter 7 bankruptcy, the bankruptcy court wipes out or discharges the debts you owe, but you will probably lose your house. Under a Chapter 13 bankruptcy, you can usually keep some of your property, including your primary residence, but you are required to follow a payment plan to repay at least part of your debts to your creditors.
Chapter 13 bankruptcy can give you the opportunity to rearrange your financial affairs, start paying off your debts, and bankruptcy can forestall foreclosure of your home. The bankruptcy petition must be filed before the sale date of your property, and you must create a plan to make your mortgage payments. Under the operation of law, if you can pay your regular mortgage payments they must be accepted by your mortgage company.
Chapter 13 stops the house foreclosure process; it stops interest accruing on personal debt, including most back taxes; and through something called the “automatic stay” it stops all collection activity. Under a court-approved Chapter 13 plan, you are required to make monthly payments to a court-appointed bankruptcy trustee for a period of three to five years. The bankruptcy trustee is responsible for paying the money to your creditors.
Is Bankruptcy Easy? No!
The legal system is complex, and your creditors will have aggressive legal counsel to challenge you at every stage of the process. You need qualified legal counsel to guide you through the procedure.
Can bankruptcy stop a foreclosure? It can at least delay it. Your home is probably secured by a deed of trust, and your mortgage company is entitled to petition the court for relief from the automatic stay. To keep your home you will have to make an agreement with your mortgage company to repay the past due amount. The question you need to ask yourself-and answer to the satisfaction of the court and your mortgage company-is if you could not pay your mortgage last month, how can you expect to pay your mortgage next month?
You may have heard of the “homestead exemption” that allows you to keep your house. According to federal law, protection for a homestead is limited to $125,000 if the property was acquired within the previous 1,215 days (3.3 years). Restrictions are complex and vary by state; this is another good reason to consult a qualified attorney.
Chapter 13 bankruptcy may buy you some time but you will not automatically get to keep your home. You will have to negotiate with your mortgage holder.
Consider the advantages of filing bankruptcy in order to keep your home:
Foreclosure proceedings are temporarily suspended.
Consider the disadvantages of filing bankruptcy solely to stop foreclosure:
For ten years there will be a bankruptcy on your credit record.
Your mortgage company can petition the court and still foreclose.
You will lose your negotiating position.
You will still have to repay past due amounts to your mortgage company.
You need to make every payment to the court-appointed trustee. If you are even one day late your case may be dismissed and your mortgage company may foreclose.
Before you consider filing Chapter 13 bankruptcy in order to save your home, think carefully about the alternatives (including selling your home) and get good legal advice.
Angela Lawrence
