Fort Lauderdale Chapter 13 Bankruptcy Attorney

What is a Chapter 13 Bankruptcy?

A Chapter 13 Bankruptcy is a repayment plan of a portion or all of your debt over a period of 36 to 60 months (3 to 5 years). The percentage or amount that you will pay back to your creditors is directly based on your financial ability to repay and/or worth of any extremely valuable belongings (not protected by exemptions).

At the completion of the payments, you will receive a discharge of the rest of the debts, similar to a Chapter 7 Bankruptcy discharge. A discharge means that the balance of the debts remaining after completing your repayment plan would be eliminated entirely or wiped out.

Since the monthly payment is based on your disposable income and value of assets (after exemptions amounts have been credited), you may pay as little as $55.00 per month. This means that your plan payments are affordable and manageable.

Why Would Someone File for Chapter 13 Bankruptcy?

A Chapter 13 Bankruptcy has multiple uses or applications as outlined below:

• If you are behind on your mortgage payments, a Chapter 13 Bankruptcy may be used to catch up on your payments and save your home.
• If you are behind on your mortgage payments and would like to apply for a loan modification to retain your home, Chapter 13 offers an exclusive loan modification application program. Click here to read more about the loan modification process in the Bankruptcy context.
• Association dues: if you are behind on your association dues, a Chapter 13 Bankruptcy may help you to eliminate the arrears and catch up on your monthly dues.
• If you own a rental property whose mortgage balance is severally above the current value of the properties (known as being “underwater”). In a Chapter 13 Bankruptcy, you may reduce the mortgage balance of a rental property down to the current market value of the property. The interest rate may also be fixed and reduced.
• If you are behind on your car loan payments, a Chapter 13 Bankruptcy may help you to retain the car by restructuring the terms of the loan. This will allow you to retain the vehicle under a new payment plan which may reduce the interest rate and/or outstanding loan balance. More importantly, the creditor will not be allowed to repossess the vehicle as long as you are making the payments pursuant to the Chapter 13 plan.
• Property taxes and tax certificates: If you are behind on your property taxes, a Chapter 13 Bankruptcy imposes a repayment plan of up to 5 years on the tax authority or tax certificate holder. This will allow you to keep your home while making monthly payments towards the property tax debt.
• If you are not eligible to file for Chapter 7 Bankruptcy because you do pass the means test, you may file for Chapter 13 relief. Click here to read about the means test.
• If you have assets which exceed exemption thresholds, you may retain them in a Chapter 13 Bankruptcy.

Foreclosure and Chapter 13 Bankruptcy

The filing of bankruptcy case stops all collection efforts, including a foreclosure action, irrespective of the stage of the case. The Bankruptcy automatic stay comes into effect immediately upon filing of the bankruptcy case.

Even if a judgment has been entered against you, you may still file for Bankruptcy and stop the sale of the property via a foreclosure auction.

In a Chapter 13 Bankruptcy case, you may be able to apply for a loan modification and keep your home. To read more about the loan modification process in bankruptcy, click here.

What Kinds of Debts are Included in a Chapter 13 Bankruptcy Plan?

A Chapter 13 Bankruptcy includes the following debts:

• Credit card debts
• Collection accounts
• Medical bills
• Personal loans
• Deficiencies resulting from repossessions
• Deficiencies resulting from foreclosure
• Debts rendered into judgments
• Personal guarantees on business debt
• In some instances, a second Mortgage, equity line or line of credit on real property may be eliminated – click here for more information
• Certain debts owed to the Internal Revenue Service

A Chapter 13 Bankruptcy does not eliminate:

• Child support obligations
• Alimony obligations
• Generally speaking, student loans are not dischargeable in bankruptcy
• Fines and penalties owed to governmental units
• Debts incurred after the bankruptcy case was filed
• Certain debts owed to the Internal Revenue Service

The best way to determine which Chapter of Bankruptcy is best for you is to speak to a qualified attorney. Contact our office to schedule your free consultation with no obligation at (954) 327-5700 or complete our online form.