Decatur Chapter 13 Bankruptcy Attorneys
The bankruptcy lawyers of Barr & Barr advise individuals and families throughout the region about Chapter 13 relief: how it works, what it involves, and whether it makes sense under your circumstances.
Sound Advice About Debt Relief in Central Illinois
If you’re under the pressure of mortgage foreclosure, wage garnishment or credit card debt that is more than you’ll ever be able to repay, our attorneys can explain your options and guide you through the Chapter 13 process, if that appears to be the best alternative for resolving your financial problems. Contact us in Decatur for a free consultation.
What Is Chapter 13 Bankruptcy?
Chapter 13 is a form of bankruptcy available to individuals and married couples that offers the same protection against creditor debt collection efforts as Chapter 7, but that requires the debtor to repay a percentage of unsecured claims under a debt repayment plan. Instead of getting a discharge of qualified debts within about four months of filing the petition, which most Chapter 7 debtors can expect, a Chapter 13 debtor makes payments each month into the Chapter 13 plan for a period of three to five years.
The Chapter 13 payments cover things like the past-due portion of mortgage debts, unpaid taxes, student loan arrearages and unsecured claims of all kinds. The amount of the monthly payment is a function of the debtor’s disposable income, and must be enough to pay more toward general unsecured claims than would have been paid in a Chapter 7 case. In practical terms, this means that most people will end up paying back about 10 or 15 percent of their unsecured indebtedness subject to discharge.
Performing Under the Chapter 13 Plan
A Chapter 13 repayment plan will be tailored to your budget, but it obviously requires a steady income in order to make it work. Once the repayment period is complete, the unpaid portion of the unsecured indebtedness is discharged. Along the way, the debtor enjoys bankruptcy court protection from collections or creditor harassment on prepetition debts during the full length of the Chapter 13 plan period.
Everything being equal, most people would rather file for bankruptcy under Chapter 7 instead of Chapter 13, but the choice isn’t always available. Here are some of the reasons why you might need to file under Chapter 13, or even choose it as your best bankruptcy option:
- A Chapter 7 filing and discharge within the past eight years makes you ineligible for Chapter 7 relief now
- Your adjusted household income is too high under the Chapter 7 means test
- You’re facing mortgage foreclosure and you want to keep your house
- You have assets that you cannot exempt from creditors in Chapter 7
Our Decatur Chapter 13 bankruptcy lawyers will advise you about your alternatives based on the nature of your financial pressures as well as your income, assets, expenses and liabilities. Our goal is to help you find practical debt solutions that make sense for your specific circumstances.
Macon County Debt Relief Attorneys: Call Barr & Barr at 217-619-9016
Find out more about the ways Chapter 13 can help you resolve a mortgage problem, deal with nondischargeable tax or student loan debt, or relieve creditor pressure across a range of financial problems. Contact a knowledgeable bankruptcy lawyer at Barr & Barr in Decatur for a free consultation.
We are a debt relief agency. We help people file for bankruptcy relief under the Bankruptcy Code.