Control Your Debt With Ewing Chapter 13 Bankruptcy Attorneys
When job loss, medical emergencies, divorce or other events clear your savings and leave you overwhelmed with debt, it can feel like getting things under control is impossible. Instead of assuming that you will need to find a way to pay all the debt, Chapter 13 bankruptcy can give you the chance to reorganize it into a plan that works for you.
At the Law Offices of Sklar Smith-Sklar, we provide our clients throughout New Jersey with the representation they deserve for their bankruptcy needs. We treat our clients with respect and compassion as we guide them through their bankruptcy plans. One of the many ways our attorneys help our clients is by explaining the details of Chapter 13 bankruptcy and how it can benefit them.
What Chapter 13 Bankruptcy Offers
Instead of selling off all your assets to pay off your debts through Chapter 7 bankruptcy, Chapter 13 bankruptcy allows you to reorganize your debt into a new repayment plan. This plan usually has a repayment timeframe of between three and five years. If the debtor makes all of their payments during this time, any remaining debt will be discharged. The size of the monthly payment depends on the debtor’s available disposable income and the value of their nonexempt assets.
Another added benefit of bankruptcy is the automatic stay that happens once you file a petition. This stay will prevent any efforts from collection agencies to collect your debt. During the length of the repayment plan, creditors will not be able to harass you about the debt and can suffer legal consequences of they do.
This bankruptcy option lets applicants keep their major assets, like their homes and cars and gives them a fresh start once they have finished their repayment. No matter what stage of the bankruptcy process you are in, we are here for you at any time and prepared to guide you through the rest of it. We can also help you file other forms of bankruptcy besides Chapter 13.
Chapter 13 Bankruptcy Frequently Asked Questions
If you are considering bankruptcy in New Jersey, you likely have many questions about the process. Our experienced team at the Law Offices of Sklar Smith-Sklar is here to help, so let’s start with a few of the questions our attorneys see most often.
How much debt is needed to file Chapter 13?
There is no lower limit requirement for a Chapter 13 bankruptcy filing. You simply need to have enough debt that going through the process will be worth it to alleviate that financial pressure. There is an upper limit, however. When combining unsecured and secured debts, the total must be less than $2,750,000. Chapter 13 eligibility is also based on income, which is why this is often called a wage earner’s plan.
What is the 100 percent plan for Chapter 13?
Some people who qualify for Chapter 13 may be able to reduce the total amount of debt they need to pay. However, when using the 100% plan, it means they do not qualify for a reduced total. They must eventually pay back 100% of the money owed. Chapter 13 just restructures the debt into an affordable monthly payment plan. This is different from Chapter 7, which liquidates assets and then eliminates debts.
If my income changes after filing Chapter 13, can my plan be modified?
Yes, it is often possible to modify your plan. For instance, perhaps your income increases, and you want to pay off your debt more quickly. Or perhaps your income decreases, so even the monthly repayment plan that you initially agreed to is no longer affordable. You do have to petition the court to get an official modification, and you should strive to meet all payment requirements until that modification is granted.
What are the long-term credit implications of completing a Chapter 13 bankruptcy?
One thing to consider is that completing a Chapter 13 bankruptcy means that you cannot file for Chapter 13 again for two years, and you cannot file for Chapter 7 for six years. The government does not restrict how many total bankruptcy filings you can have, but you must go through these waiting periods. Additionally, Chapter 13 will reduce your credit score, but eliminating your debt gives you a chance to rebuild your credit. It is important to budget carefully and have a financial plan to repair your credit score, such as using a secured credit card.
Our New Jersey Lawyers Are Here To Help
Bankruptcy is not a sign of failure or bad money skills. Anyone can find themselves in need of the benefits of bankruptcy even with the best financial planning, and we want to be the ones who help them through it. If you are ready to meet with an experienced lawyer that you can count on, call our Ewing office at 609-568-7877 or email us here to schedule your initial consultation today.