Filing for Chapter 13 Bankruptcy in Mississippi
Chapter 13 bankruptcy is a good option for people who are overburdened by debt and collection activity, but still have a steady income. That’s because Chapter 13 allows you to consolidate your debts and negotiate more manageable payment terms with your creditors. After your Chapter 13 repayment period expires, any remaining unsecured debts you have are generally discharged.
Chapter 13 Eligibility
The primary requirement to file for Chapter 13 bankruptcy is to have regular income. Even if you are ineligible to file for Chapter 7 due to a previous bankruptcy or having too much income, you may still qualify for Chapter 13 if you show the bankruptcy court that you will have enough disposable income to make payments on your debts. In order to determine your disposable income, you must subtract your monthly expenses and required payments on secured debts, such as a mortgage or car loan.
Another eligibility requirement for Chapter 13 is that your debts cannot be too high. For secured debts, the amount you owe cannot exceed $1,149,525, and for unsecured debts, like credit cards, you cannot owe more than $383,175. These amounts are adjusted periodically for inflation.
Chapter 13 Procedure
The core of filing for Chapter 13 bankruptcy is preparing a proposed payment plan showing how you will pay for your basic needs and make payments on your debts at the same time. You must present this plan to the bankruptcy court’s trustee and your creditors for their review. If approved, you then will be able to keep all of your assets during the three to five year repayment period, and creditors cannot charge interest on your debts. All payments you make go straight to the principal balance of each debt.
An experienced Mississippi bankruptcy attorney can help you draft a complete, workable repayment plan to submit to the bankruptcy court, and represent you during any appearances you need to make before the bankruptcy trustee and your creditors. Keep in mind that bankruptcy is a legal proceeding. A lawyer will promote your interests and protect your rights as you move through the stages of bankruptcy.
Benefits of Chapter 13
Often, Chapter 13 bankruptcy is used to save a home from foreclosure or a vehicle from repossession because it can help bring these types of loans back up to date. Chapter 13 can also help repay non-dischargeable debts, such as past due taxes or child support arrears. For unsecured debts, including credit cards and medical bills, you are often only required to pay a percentage of what you owe.
Talk to Us about Chapter 13 Bankruptcy
If you are having trouble paying your monthly expenses, call us at the Gardner Law Firm to discuss Chapter 13. During your free initial consultation, we can answer your basic questions about bankruptcy, and help you determine your best course of action moving forward.