Addressing Debt Through Chapter 13 Bankruptcy

Chapter 13 is an effective means of addressing overwhelming debt for people who have some form of steady income, whether through a job, unemployment benefits or another source. Unlike Chapter 7, which discharges most of your debt immediately, filing for Chapter 13 will reorganize your debt and allow you to pay it down through affordable payments over a three- to five-year period. At the end of this repayment period, any remaining obligations under the repayment plan will be discharged.

The Newark bankruptcy attorney at the Law Offices of Darin D. Pinto, P.C., can explain the benefits of filing for Chapter 13 and whether this is the right option for your situation.

You May Be Able To Hold On To Your House And Other Assets

When you file for Chapter 13 protection, any collections actions being taken against you will come to an immediate halt, including foreclosure proceedings. This can buy you the valuable time you need to catch up on your mortgage payments or other forms of secured debt, such as auto loans.

If you do not have a steady stream of income or have limited income, Chapter 13 may not be the best option for you. In these cases, a Chapter 7 filing may better address your needs. Regardless of your situation, attorney Darin D. Pinto will thoroughly review your situation and provide you with the information you need to choose the best path forward for you.

Answers To Frequently Asked Bankruptcy Questions

Below, you’ll find answers to common questions about Chapter 13 bankruptcy. You can get answers to your own case-specific questions by contacting a knowledgeable Chapter 13 bankruptcy lawyer.

Who can benefit from Chapter 13 bankruptcy?

The most appropriate candidates for Chapter 13 are people who could repay their overwhelming debt if given time and more favorable repayment terms. Many individuals considering bankruptcy don’t qualify for Chapter 7, typically because their income is too high. The most common alternative to Chapter 7 is Chapter 13, which doesn’t require someone to pass a “means test.”

Chapter 13 is also appropriate for individuals who have secured debt (like a mortgage or car loan) and want to find a way to hold onto their home or vehicle, as well as those with debts that typically could not be discharged in a Chapter 7 bankruptcy (like student loans, back taxes or overdue alimony/child support payments).

What debts are affected by Chapter 13 bankruptcy?

Chapter 13 can be used to repay most types of debt, including debts in the following categories:

  1. Secured Debts: These are debts backed by collateral, such as mortgages and car loans. Chapter 13 can help you catch up on arrears (past due payments) and potentially restructure these loans to make them more manageable.
  2. Unsecured Debts: These include credit card debts, medical bills, and personal loans. While you may not have to pay back all unsecured debts in full, you are required to pay as much as your disposable income allows over the course of your repayment plan.
  3. Priority Debts: These debts must be paid in full during the Chapter 13 plan and are typically nondischargeable. They include certain taxes, alimony, child support, and wages owed to employees.

As mentioned above, certain debts may not need to be repaid in full. As long as you make regular payments throughout the course of your repayment plan, some remaining debt can be discharged.

How long can Chapter 13 bankruptcy take to complete?

Each plan is unique because it is based on an individual’s debts, available income and other factors. However, most Chapter 13 repayment plans are structured to last between three and five years.

Do You Need Time To Catch Up On Payments? Contact The Law Offices of Darin D. Pinto, P.C., For A Free Consultation.

If you are struggling with unpaid or overdue bills, help maybe just a phone call away. To schedule a free consultation with a skilled Chapter 13 bankruptcy lawyer, call the Law Offices of Darin D. Pinto, P.C., in Westfield, New Jersey, at 908-913-6168. You may also contact the firm online, and attorney Pinto’s team will get back to you as soon as possible.

Law Offices of Darin D. Pinto, P.C., is a debt relief agency. It helps people file for bankruptcy relief under the Bankruptcy Code.