Filing for Bankruptcy comes with a lot of misconceptions. Individuals who are facing financial hardships have the option to file for bankruptcy to start new. Though it may seem daunting due to the way our society views bankruptcy, filing for bankruptcy allows individuals to get back on their feet. There are a few different types of bankruptcy that individuals can file depending on their financial status. Continue reading to learn about Chapter 13 bankruptcy and who qualifies for this type of bankruptcy. Reach out to our experienced bankruptcy attorney for legal counsel to proceed with this process. Give our firm a call today to discuss the next steps you will take to achieve this fresh start.
What is Chapter 13 Bankruptcy?
To file for Chapter 13 bankruptcy, individuals must have assets, value to their home, or earn above the average income for a family in the country they live in. Filing for Chapter 13 can offer protection by the Bankruptcy court which allows those who file to keep all of their assets as long as they create and submit a plan to repay their debts over the course of three to five years.
Under their plan, debtors must repay their unsecured creditors what they can afford based on their income and expenses. This plan will include medical bills, personal loans, credit card debts, or debts owed on car loans. Student loans, alimony, child support payments, income taxes, restitution, compensation ordered by Criminal Court, debts incurred by fraud, and any civil judgments for injures that occur due to intentional torts or driving intoxicated must be paid as well.
What is the Automatic Stay?
The Automatic Stay is enforced by the Bankruptcy Court when a person files for any type of bankruptcy. The Automatic Stay is a system that prohibits creditors from taking part in any collection activities towards the debtors including collection letters or calls, foreclosures, repossessions, bank restraints, and lawsuits. The Automatic Stay allows debtors to find relief from harassment as they begin to pay back debts through their bankruptcy plan.
The following are the most prevalent benefits of the Automatic Stay:
- The Automatic Stay is enforced immediately after filing for bankruptcy
- It prevents harassment
- Collectors cannot pursue debts while it is in place
- It gives debtors room to breathe in order to recover their finances
Contact our experienced New York firm
Bankruptcy, for many people, is a frightening endeavor. Fortunately, with the help of an experienced attorney, it does not have to be. If you require the services of an experienced Business Law or Bankruptcy attorney, contact the Law Offices of Allen A. Kolber, Esq. today to schedule a consultation and discuss your options. We will have your back every step of the way.
