When debts become overwhelming, there are many people who prefer to declare bankruptcy. The type of bankruptcy will depend on the needs of the individual and their income. For example, people with little income remaining when the month ends and less assets choose chapter 7. This option wipes out qualifying debt within 4 to 6 months without needing to pay creditors. When considering chapter 13 Monterey residents need to know what it entails.
Persons who earn significant income and those who look to protect their valuable property are better off with chapter 13. In exchange for being given the debt relief, the filer will be required to pay discretionary income to all creditors. That should happen within 3 or 5 years. There are various reasons for people to consider this bankruptcy option. To begin with, it will assist when it comes to foreclosure. The home will be protected from foreclosure.
Under normal circumstances, banks demand that borrowers pay back the full mortgage arrears. For families or individuals who are struggling financially, they will find that option not being possible and they could end up losing their home. Chapter 13 debtors are able to dictate terms of repayment. Amounts that are past-due are broken down into small chunks that are manageable and which are paid back over the life of the chapter 13 plan.
Filing for this option will assist with mortgage modification. Not only will it be possible to dictate to the lender terms under which past-due mortgage payments will be paid but you can also have them modify the mortgage. First mortgages are not supposed to be modified but the second and third can be modified through a process called lien stripping. Once a mortgage gets stripped, the debtor gets to pay the loan with the rest of their unsecured debt.
There is a benefit of chapter 13 over 7 is as concerns the credit report. With chapter 13, there will be showing of the bankruptcy on your credit report for 7 years or so, as compared with 10 years in the case of chapter 7. The implication is that creditors will know your credit history for a shorter period, which will work to your advantage.
There are some requirements before one is deemed to qualify. One thing to understand first is that there are limits of debt that one can have. The unsecured and secured debts are not supposed to get past some amount. In case the debts are too much, one will not qualify. The other requirement is that you are supposed to prove that you have a steady income. Having a steady income means you need to afford your monthly expenses and still be able to make repayments.
This option is never available for companies. That means that only individuals are eligible. Nevertheless, business-related debts which one is personally responsible for can be part of the plan. That means that a sole proprietorship will be able to benefit.
When the repayment plan is completed, you will need to prove to the court that you are current on your alimony obligations as well as child support. There is also a requirement to complete a counseling course. When the requirements are met, the remaining balance can be wiped out.
Persons who earn significant income and those who look to protect their valuable property are better off with chapter 13. In exchange for being given the debt relief, the filer will be required to pay discretionary income to all creditors. That should happen within 3 or 5 years. There are various reasons for people to consider this bankruptcy option. To begin with, it will assist when it comes to foreclosure. The home will be protected from foreclosure.
Under normal circumstances, banks demand that borrowers pay back the full mortgage arrears. For families or individuals who are struggling financially, they will find that option not being possible and they could end up losing their home. Chapter 13 debtors are able to dictate terms of repayment. Amounts that are past-due are broken down into small chunks that are manageable and which are paid back over the life of the chapter 13 plan.
Filing for this option will assist with mortgage modification. Not only will it be possible to dictate to the lender terms under which past-due mortgage payments will be paid but you can also have them modify the mortgage. First mortgages are not supposed to be modified but the second and third can be modified through a process called lien stripping. Once a mortgage gets stripped, the debtor gets to pay the loan with the rest of their unsecured debt.
There is a benefit of chapter 13 over 7 is as concerns the credit report. With chapter 13, there will be showing of the bankruptcy on your credit report for 7 years or so, as compared with 10 years in the case of chapter 7. The implication is that creditors will know your credit history for a shorter period, which will work to your advantage.
There are some requirements before one is deemed to qualify. One thing to understand first is that there are limits of debt that one can have. The unsecured and secured debts are not supposed to get past some amount. In case the debts are too much, one will not qualify. The other requirement is that you are supposed to prove that you have a steady income. Having a steady income means you need to afford your monthly expenses and still be able to make repayments.
This option is never available for companies. That means that only individuals are eligible. Nevertheless, business-related debts which one is personally responsible for can be part of the plan. That means that a sole proprietorship will be able to benefit.
When the repayment plan is completed, you will need to prove to the court that you are current on your alimony obligations as well as child support. There is also a requirement to complete a counseling course. When the requirements are met, the remaining balance can be wiped out.
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Find an overview of the benefits of consulting a Chapter 13 Monterey attorney and more info about a reliable lawyer at http://www.centralcoastbankruptcy.com today.
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