Chapter 13 Bankruptcy: NOT a debt repayment plan

/Chapter 13 Bankruptcy: NOT a debt repayment plan
Chapter 13 Bankruptcy: NOT a debt repayment plan 2018-08-10T21:32:17+00:00

Chapter 13 Bankruptcy Relief

Denver Bankruptcy Attorney for Chapter 13:

  • NOT A DEBT REPAYMENT PLAN — ELIMINATE MOST OF YOUR DEBT IN MOST CASES.

  • STOP FORECLOSURE. KEEP YOUR HOME

  • ELIMINATE YOUR SECOND MORTGAGE IN MANY CASES

  • RESTRUCTURE TAX DEBT WITH NO PENALTIES

  • PAY THE VALUE OF YOUR CAR IN MANY CASES, NOT WHAT YOU ACTUALLY OWE ON THE CAR

  • ELIMINATE DIVORCE OBLIGATIONS (BUT YOU CANNOT ELIMINATE CHILD SUPPORT OR MAINTENANCE)

  • STOP CONTEMPT OF COURT PROCEEDINGS FOR CHILD SUPPORT OR MAINTENANCE

  • PAY DELINQUENT CHILD SUPPORT OR MAINTENANCE OVER A FIVE YEAR PLAN

Why file Chapter 13 bankruptcy? Because a Chapter 13 bankruptcy attorney can fix serious financial problems that cannot be fixed in any other type of bankruptcy.  When you really need a Chapter 13 bankruptcy lawyer, filing under Chapter 7 can be disastrous at worst — or result in lost opportunities at best.  A Chapter 13 bankruptcy is not only for people who earn too much money to file Chapter 7.  Knowing when to file a Chapter 13 bankruptcy is important.  A Chapter 13 bankruptcy attorney specialist can make this determination.  Some bankruptcy lawyers claim they “only file chapter 7 cases” usually because they don’t understand Chapter 13 bankruptcy.  We are Chapter 13 bankruptcy attorneys who know Chapter 13 bankruptcy inside out.  We’ve been doing it for over 23 years.

Contrary to popular belief, Chapter 13 does NOT mean you must repay your debts in full.

Write off most, if not all, of your unsecured debts.  A Chapter 13 bankruptcy is a plan of financial reorganization. Contrary to popular belief, Chapter 13 does NOT mean that you must repay all your debt. Most Chapter 13 plans involve the repayment of about 20% (sometimes MUCH less, sometimes more) of your debts over a three to five year period. The debt that is not repaid is “discharged” or written off when you complete the bankruptcy repayment plan.

Stop foreclosure. Eliminate your second mortgage in many Chapter 13 bankruptcy cases.

In a Chapter 13 bankruptcy reorganization plan, you can get your house out of foreclosure.  Your past-due mortgage payments are paid over time in a five-year reorganization.  Furthermore, in many cases, you can strip off your second mortgage meaning you get to keep your house without having to pay the second mortgage.

Stop IRS tax levies.  Pay back taxes without penalty and interest over time.

With Chapter 13 bankruptcy, you can restructure income taxes over five years without any additional penalties. Some taxes don’t have to be paid at all.

Protect all of your property. Nobody is waiting to liquidate any of your property.

Filing Chapter 13 bankruptcy protects all of your property from a Chapter 7 trustee who is waiting to liquidate any non-exempt assets.

Behind on child support or maintenance?  Stop contempt proceedings immediately.

If you owe back child support or maintenance, the quickest way to permanently get the former spouse off your back is through Chapter 13 bankruptcy.  Even if you have a contempt hearing coming up in a few days, that hearing will come to a grinding halt when you file Chapter 13.  Your back support payments will be paid over the life of a five-year bankruptcy reorganization plan.

Eliminate divorce obligations not related to child support or maintenance.

If you were ordered — for example — to pay “half of the marital credit card debts” then Chapter 13 bankruptcy can fix that, too.

How Chapter 13 bankruptcy works:

Chapter 13 bankruptcy is based in part on your ability to repay. Simply put, the bankruptcy court looks at your net income minus your expenses in determining how much you must pay to your creditors every month. However, under bankruptcy “reform”, your ability to repay is determined mainly by application of maximum “allowable” expenses established by the Internal Revenue Service’s collection standards.

When you retain us as your Chapter 13 bankruptcy attorney, we know how to use the law to your advantage. This means that even though your expenses may be higher than the IRS’ idea of “average” we look for other allowable deductable expenses that help reduce your monthly Chapter 13 bankruptcy reorganization plan payment. Such expenses include, but are not limited to:

  • 401(k) contributions up to the maximum you can contribute to your plan
  • Daycare expenses
  • Mortgage expenses over and above the presumed housing allowance
  • Medical and life insurance expenses
  • Mandatory payroll deductions
  • Domestic Support Obligations

Before the summer of 2010, this was a lot of ambiguity regarding the size of your bankruptcy payment. The Chapter 13 Trustee argued that your payment had to be based on your last six months of income (means testing) instead of being based on your current income and ability to pay.

The U.S. Supreme Court shot down this unreasonable position in a decision called Hamilton vs. Lanning. Your bankruptcy payment now must be based on your actual current ability to pay — NOT entirely on your past income. More information on the Lanning decision is located here.

After we crunch all the numbers for you, we determine an affordable monthly debt reorganization payment and propose a Chapter 13 plan to the court.  After a hearing, sometimes two hearings. the bankruptcy court approves your reorganization plan.  You then receive a Chapter 13 discharge when your Chapter 13 bankruptcy plan is completed in three to five years.  In the average case, you repay less than 20% of your debts — sometimes only a few pennies on the dollar.  The rest of what you owe is simply written off.

Some chapter 13 bankruptcies may be filed with little more than $100 attorney fees out of pocket to you. This requires a wage order to the bankruptcy trustee for your plan payments and payment of the court filing fee. Certain repeat filers will not qualify for this offer depending on the circumstances.

Click here for Chapter 13 Frequently Asked Questions