Advantages Of Chapter 13 Bankruptcy Law
Chapter 13 is often the main idea that crosses people's mind when they think about bankruptcy proceedings. The reason for this is because chapter 13 bankruptcy law is one of the most common proceedings, especially for individuals. The biggest benefit that is reaped from a Chapter 13 is because you are able to typically keep all of your assets, such as a car or a home.
While Chapter 7 involves liquidation of all assets, Chapter 13 bankruptcy law allows you to keep those assets as long as you can afford a payment each month to the trustee. The trustee then takes the money paid in each month and divides it amongst the creditors. This is done for a specific period of time that is agreed upon with the creditors, the debtor, and the judge with the trustees help.
If payments are not made, then the judge can allow creditors to start repossession proceedings, however as long as payments are being made they are not allowed to repossess or foreclose on property for any reason. The reason for this is because since Chapter 13 bankruptcy law allows people to keep their things, the creditors are not allowed to take them anyways.
In exchange for keeping the things and making payments, the debtor agrees to contact the trustee if there is a problem in making payments towards the bankruptcy debt for any reason. While the trustee has the ability to give an extension for problems, they are not required to do so. Because of the close relationship between the trustee and yourself, it is often a good idea to make sure all communication stays positive and focused strictly on your case. Your trustee is not someone whom you want to be upset with you for any reason. If this occurs then you can have a lot of problems while trying to deal with your bankruptcy. Because Chapter 13 bankruptcy law allows for payments to be made monthly, it is possible to take a rather large and typically unmanageable debt and turn it into something that is entirely possible to use and handle. Instead of feeling overwhelmed by creditors calling continuously they are banned from calling if they are listed in the bankruptcy papers which provides you with some peace until you have your financial affairs back in order. As you can see there are several reasons why a Chapter 13 bankruptcy is the best option, especially for individuals. However, if you are unable to make payments each month then a liquidation bankruptcy is still an option but not as popular. Speak to an attorney that specializes in Chapter 13 bankruptcy law to determine if this is the best course of action that you can take in regards to your personal situation. Never wait until it is too late to save your assets if you think you may want to file a Chapter 13, while it can protect your assets, if they are already gone, then it is too late to save them.
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