Tucson Chapter 13 Bankruptcy Law Firm
When to Consider Chapter 13 Bankruptcy
Chapter 13 Bankruptcy is often called “wage earner’s bankruptcy” or a “debt repayment plan.” If you have a steady income, but are having difficulty paying down your debt, you can reduce your debt and eliminate others by filing for Chapter 13 Bankruptcy.
You can pay back overdue house payments and save your home from foreclosure. You can bring your car note up to date. You will also be able to pay overdue child support or alimony. In some circumstances, you are even allowed to pay back taxes without interest or penalties.
You are allowed to develop a repayment plan according to your financial circumstances. For instance, if your income is at or below the median, you are eligible for a three year payback plan. If it is higher than the median, you repayment plan will be stretched out to 60 months.
Protecting Your Most Valuable Assets
Under Chapter 13 protection, you can keep your home and automobile. In fact, you may keep all your personal property.
If you file for Chapter 13 Bankruptcy, you can:
- Keep all your property, including your home and your car
- Save your home from foreclosure or attachment
- Bring your mortgage payments current by paying over time
- Strip away HELOC debt (2nd mortgages) under certain circumstances
- Catch up on spousal or child support obligations
- Protect co-signers from financial liability
Other Advantages of Chapter 13 Protection
One advantage of filing for Chapter 13 Protection is a concept called “cram down.” In a cram down of debt in Chapter 13, you may keep collateral, such as your car or furniture, as long as you repay the fair market value of the collateral during your repayment plan. You won’t be obligated to pay the full amount of the debt.
You may eliminate the threat of foreclosure by a legal bankruptcy process known as “lien stripping.” During a Chapter 13 bankruptcy, the court may allow you to completely strip away and eliminate a second mortgage (home equity line of credit – HELOC), as long as the current fair market value of your property is worth less than what you owe on your first mortgage. Our bankruptcy attorneys can explain the process to you in detail.
Our Tucson Chapter 13 Bankruptcy lawyers have helped thousands of people in Southern Arizona emerge from the burden of overwhelming debt. We can help you. Call the Vidrine Law Firm, PLC, for a confidential and free evaluation at 520.885.1106.
