When debts become overwhelming, there are many people who prefer to declare bankruptcy. The type of bankruptcy will depend on the needs of the individual and their income. For example, people with little income remaining when the month ends and less assets choose chapter 7. This option wipes out qualifying debt within 4 to 6 months without needing to pay creditors. When considering chapter 13 Monterey residents need to know what it entails.
Persons who earn significant income and those who look to protect their valuable property are better off with chapter 13. In exchange for being given the debt relief, the filer will be required to pay discretionary income to all creditors. That should happen within 3 or 5 years. There are various reasons for people to consider this bankruptcy option. To begin with, it will assist when it comes to foreclosure. The home will be protected from foreclosure.
Normally, banks will require borrowers to pay back the mortgage arrears in full. For individuals or families which are struggling financially, the payment of the arrears in full might not be possible and thus they could lose the home. Chapter 13 debtors can dictate how the repayments are to be done. If there are amounts which are past-due, they will be broken down into small bits which are easily manageable. They are to be paid over the life of the plan.
When one chooses this option, it will help in mortgage modification. It will not just be possible to dictate to a lender the terms under which to pay past-due payments but it will also be possible to have the mortgage modified. As a rule, first mortgage should not be modified but it is possible to modify the second and third. The modification is done through a process called lien stripping. After a mortgage gets stripped, the loan will be paid by the debtor.
There is the advantage of the option when compared to for instance chapter 7. That is as regards the credit reports. With chapter 13, the credit report is shown for less period of time, generally 7 years as compared to 10 years for chapter 13. Essentially, it means that creditors will see the details for a shorter period of time.
There are some requirements before one can qualify for this bankruptcy. One of the first things to understand is that there are debt limits. Secured and unsecured debts cannot exceed some amounts. If the total debt is too high, you will definitely be disqualified. The second requirement is that you will be required to prove that your income is steady. That means you should be able to afford both monthly household obligations and still be able to repay into the repayment plan.
This option is never available for companies. That means that only individuals are eligible. Nevertheless, business-related debts which one is personally responsible for can be part of the plan. That means that a sole proprietorship will be able to benefit.
When the repayment plan is completed, you will need to prove to the court that you are current on your alimony obligations as well as child support. There is also a requirement to complete a counseling course. When the requirements are met, the remaining balance can be wiped out.
Persons who earn significant income and those who look to protect their valuable property are better off with chapter 13. In exchange for being given the debt relief, the filer will be required to pay discretionary income to all creditors. That should happen within 3 or 5 years. There are various reasons for people to consider this bankruptcy option. To begin with, it will assist when it comes to foreclosure. The home will be protected from foreclosure.
Normally, banks will require borrowers to pay back the mortgage arrears in full. For individuals or families which are struggling financially, the payment of the arrears in full might not be possible and thus they could lose the home. Chapter 13 debtors can dictate how the repayments are to be done. If there are amounts which are past-due, they will be broken down into small bits which are easily manageable. They are to be paid over the life of the plan.
When one chooses this option, it will help in mortgage modification. It will not just be possible to dictate to a lender the terms under which to pay past-due payments but it will also be possible to have the mortgage modified. As a rule, first mortgage should not be modified but it is possible to modify the second and third. The modification is done through a process called lien stripping. After a mortgage gets stripped, the loan will be paid by the debtor.
There is the advantage of the option when compared to for instance chapter 7. That is as regards the credit reports. With chapter 13, the credit report is shown for less period of time, generally 7 years as compared to 10 years for chapter 13. Essentially, it means that creditors will see the details for a shorter period of time.
There are some requirements before one can qualify for this bankruptcy. One of the first things to understand is that there are debt limits. Secured and unsecured debts cannot exceed some amounts. If the total debt is too high, you will definitely be disqualified. The second requirement is that you will be required to prove that your income is steady. That means you should be able to afford both monthly household obligations and still be able to repay into the repayment plan.
This option is never available for companies. That means that only individuals are eligible. Nevertheless, business-related debts which one is personally responsible for can be part of the plan. That means that a sole proprietorship will be able to benefit.
When the repayment plan is completed, you will need to prove to the court that you are current on your alimony obligations as well as child support. There is also a requirement to complete a counseling course. When the requirements are met, the remaining balance can be wiped out.
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Find an overview of the benefits of consulting a Chapter 13 Monterey attorney and more info about a reliable lawyer at http://www.centralcoastbankruptcy.com today.
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