What Should Do if You Can’t Make Your Chapter 13 Payment?

Bankruptcy Lawyer St. PetersburgFiling for bankruptcy is a stressful process that directly impacts the lives of those who file. When you file for chapter 13 bankruptcy, you state that you, using your regular income, will follow a plan to repay all or a part of your debts over three to five years. Chapter 13 bankruptcy filings are particularly attractive because filers may save their homes from foreclosure.

Filers are required to follow a chapter 13 repayment plan. By failing to remain up-to-date on your repayment plan, you run the risk of having your bankruptcy case dismissed by a trustee or creditor. Options exist for you to avoid negative consequences should you become aware that you will be unable to make a chapter 13 payment.

Work With Your Bankruptcy Trustee

You will be assigned a bankruptcy trustee in a chapter 13 bankruptcy case. The trustee will collect your timely payments and distribute them to the appropriate creditors. Since your bankruptcy works as an intermediary between you and your creditors, it is advisable to inform your trustee that you will be unable to make a payment. The trustee may work with you in an informal capacity, especially if the reason for your missed payment is temporary or the result of an unforeseen financial emergency, such as the unexpected loss of a job. By informing their trustees, debtors may avoid the dismissal of their case, and debtors may be able to get caught up over the course of the following months.

Consider Modifying Your Repayment Plan

Chapter 13 repayment plans may be modified. It is not always possible to follow a repayment plan as originally designed. Modifying a repayment plan may provide relief for debtors facing a sudden financial emergency such as a loss of employment. A debtor can petition the bankruptcy court to modify his or her repayment plan. The petition must delineate the change in circumstances requiring the modification as well as those specific changes the debtor wishes to make. The court will review the petition, applying the appropriate tests to determine whether a modification is appropriate.

Obtain a Hardship Discharge

Eligible debtors may receive a hardship discharge. In the event that a hardship discharge is granted, a debtor shall be relieved of his or her remaining payments. A court determines whether a hardship discharge is appropriate after reviewing the debtor’s financial situation and analyzing the best interests of the parties. It is important to note that certain debts may not be discharged, and you should speak with an experienced attorney who can better explain the effect of your hardship discharge.

Perhaps bankruptcy isn’t right for you. Although filing for chapter 13 bankruptcy can provide financial relief and stability, your inability to continue making required payments may provide you with no benefit. Thus, debtors may consider dismissing their bankruptcy case and refiling.

Contact Us Today to Speak with a St. Petersburg Bankruptcy Attorney

Alternatives exist should you be unable to make your chapter 13 payment. However, you should avoid navigating the complex options available alone. Our skilled and experienced bankruptcy attorneys at Berkowitz & Myer are committed to providing you with the legal counsel you require when faced with the complexities of chapter 13 bankruptcy. Schedule your initial consultation by calling us at (727) 344-0123 or by contacting us through our online contact form.

Chapter 13 Terminology—Who’s Who in Bankruptcy?

Bankruptcy Attorney St. Petersburg

If you’re reading about bankruptcy online, there’s a good chance that you’re coming across a lot of terminology that’s new or unfamiliar. In particular, you may be coming across the names of various parties that are involved in bankruptcy and be confused as to exactly who they are. Below is some basic information about the main players in a bankruptcy case and their role. For more information, please call our office today to schedule a free consultation with a Chapter 13 bankruptcy attorney in St. Petersburg.

The Debtor

The debtor is the person filing for bankruptcy (the person who owes debts). In Chapter 13, the debtor is always an individual (businesses cannot file for bankruptcy) and is seeking to restructure his or her personal debts. Married couples are able to file for Chapter 13, jointly, however, and will be referred to collectively as “debtors.”

Creditors

In a bankruptcy case, creditors are the parties to whom debts are owed. Common examples of creditors listed in a Chapter 13 case include credit card companies, healthcare providers, mortgage lenders, utility companies, and banks.

Bankruptcy Trustee

In a Chapter 13 bankruptcy, the trustee is the individual who is assigned by the court to administer your case. Some of the responsibilities of the trustee include the following:

  • Look at your proposed repayment plan and determine whether it complies with the requirements set forth in the United States Bankruptcy Code.
  • Review any claims made by creditors and object to any that lack sufficient documentation or are improperly made.
  • Conduct the meeting of creditors, which you are required to attend. At this meeting, you will be placed under oath and asked questions regarding your assets, income, or other relevant information.
  • Receive bankruptcy plan payments and distribute them amongst creditors

U.S. Bankruptcy Court

Bankruptcies are filed in specialized federal courts known as United States Bankruptcy Courts. These courts only hear bankruptcy cases and have jurisdiction over your case from the moment it is filed to its conclusion.

Your Bankruptcy Attorney

Finally, if you are filing for bankruptcy, it is highly advisable that you do so with the assistance of an experienced lawyer. In fact, on the United States Courts official website, it states that “[i]ndividuals can file bankruptcy without an attorney, which is called filing pro se. However, seeking the advice of a qualified attorney is strongly recommended because bankruptcy has long-term financial and legal outcomes.”

An attorney can review your financial situation, collect any necessary paperwork, prepare the documents that you need to file with the court, represent you at the meeting of creditors, and generally protect your rights along every step of the way.

Call Berkowitz & Myer Today to Schedule a Free Case Evaluation

Financial problems can often be alleviated through Chapter 13 bankruptcy—particularly when you have regular income but have fallen behind on your payments. The lawyers of Berkowitz & Myer will review your financial situation at no cost to you and let you know whether we believe that you could benefit from pursuing bankruptcy. To schedule an appointment with one of our lawyers, call Berkowitz & Myer today at (727) 344-0123 or send us an email through our online contact form.

The Pros and Cons of Chapter 13 Bankruptcy

Bankruptcy Attorney St. PetersburgThe Pros and Cons of Chapter 13 Bankruptcy

There are many misconceptions about bankruptcy. Some people are worried that filing means that they have failed in life and that they will be left penniless and unable to ever secure financing or a loan again. On the other hand, others fail to recognize that bankruptcy is a major decision and file without considering the fact that doing so will likely affect them for years to come.

Chapter 13 one type of bankruptcy that is often utilized by people who earn a steady paycheck but have fallen being on their bills. Here are some of the advantages and disadvantages associated with Chapter 13 bankruptcy. For more information, call our office today to speak with a St. Petersburg bankruptcy lawyer.

Chapter 13: The Upsides

One of the main benefits of Chapter 13 bankruptcy (as opposed to a Chapter 7 bankruptcy) is that it allows debtors to keep their assets. In Chapter 13, you enter into a court-approved payment plan that allows you to pay all or some of your debts over the course of three to five years. Homeowners can wrap any mortgage arrears into their payment plan, meaning as long as they stay current on their mortgage during the course of the plan, they will be able to stay in their home. In addition, at the conclusion of a Chapter 13 plan, most (if not all) of a debtor’s remaining debts will be discharged, which means that they are under no obligation to pay them.

Chapter 13: The Downsides

Filing for any bankruptcy is not without cost. The fact that you filed will remain on your credit report for years and negatively affect your credit score, making it more difficult to obtain financing and increase your interest rates if you do. In addition, filing for Chapter 13 bankruptcy may make it more difficult to get a job, as employers who run credit checks may see a bankruptcy as a sign of irresponsibility. In addition, in some cases, filing for Chapter 7 may be able to eliminate more debt than filing for Chapter 13.

So, Should You File for Chapter 13?

The decision to file for Chapter 13 is should be carefully considered. Some of the factors that can determine whether Chapter 13 is right for you to include your total debt load, the types of debt you have, your income, and the kinds of assets that you have. The best way to determine whether it is right for you is to consult with an attorney who is familiar with bankruptcy law and will explore all of the options available to you.

Call Berkowitz & Myer Today to Speak to a St. Petersburg Bankruptcy Lawyer

The lawyers of Berkowitz & Myer will review your financial situation at no cost and let you know whether we believe that filing for bankruptcy would benefit you. To schedule a consultation with a bankruptcy attorney in St. Petersburg, call our office today at (727) 344-0123 or send us an email through our online contact form.

An Overview of the Chapter 13 Process

Bankruptcy Attorney St. PetersburgAn Overview of the Chapter 13 Process

Chapter 13 is a type of bankruptcy that is often referred to as a “reorganization” bankruptcy, as it allows debtors to reorganize their debts and make regular payments that are distributed amongst their various creditors. Chapter 13 is significantly different from a Chapter 7 liquidation bankruptcy in that it allows debtors to keep their property while they are making payments towards their plan, which can last anywhere from three to five years. At the conclusion of the plan, many leftover debts are discharged, which means that debtors are no longer under any legal obligation to pay them back.

Here are some of the steps involved in filing for Chapter 13 bankruptcy:

Determining Whether You Qualify

First, you need to determine whether you qualify for Chapter 13 bankruptcy, as not everyone does. In order to qualify, you need to be able to show the court that you will have enough income left over each month to make a payment. In addition, your debts must be under a certain threshold in order to be able to file for Chapter 13.

Complete an Approved Credit Counseling Course

In order to be able to file for Chapter 13, you must have completed a credit counseling course in the previous six months. You can see the list of agencies that offer approved courses at the United States Trustee’s website.

Prepare and File the Bankruptcy Petition

Next, you must prepare the forms that are associated with filing for Chapter 13. These forms list all of your assets and debts and must be complete in order to be accepted. Failing to account for all of your assets could result in you’re the denial of your petition—or even criminal bankruptcy fraud charges. For this reason, it is extremely important for anyone filing for bankruptcy to be extremely thorough with the information they provide to the court.

You must also file a proposed repayment plan with the court at this point. Because Chapter 13 repayment plans are extremely complicated, it is highly advisable to create one with the assistance of an experienced attorney.

The Automatic Stay and Confirmation of Your Plan

At this point, if the court approves your petition, the court will issue an automatic stay that prevents creditors from taking any collection actions, including foreclosure, repossession, filing lawsuits, or sending letters or making calls. Before your plan can be approved, there must be a meeting of creditors where they can ask you about your finances and potentially object to your plan. There will then be a confirmation hearing at which the court addresses any objections or issues.

Complete Your Repayment Plan

If confirmed, you will then enter Chapter 13 bankruptcy for the duration of your repayment plan. So long as you stay current with your payments, you will be protected from collection action from the creditors who are part of your plan.

Personal Financial Management Class and Discharge

Upon the conclusion of your repayment plan, you will need to take a debtor education class before the court closes your case. Once this has occurred, the court will discharge any eligible debt and your bankruptcy will be over.

Call Berkowitz & Myer Today to Speak with a St. Petersburg Chapter 13 Lawyer

If you are experiencing financial distress in spite of making a regular income, Chapter 13 bankruptcy may be able to help you. At Berkowitz & Myer, we will take the time to fully evaluate your financial situation and let you know how we think you should proceed. To schedule a free case evaluation with one of our bankruptcy attorneys in St. Petersburg, call our office today at (727) 344-0123 or send us an email through our online contact form.

How Chapter 13 Bankruptcy Affects Legal Judgments

How Chapter 13 Bankruptcy Affects Legal Judgments

Being the subject of a lawsuit is always stressful and any judgments against you can significantly affect your finances. In fact, many legal judgments require a person to file for bankruptcy because they cannot afford to pay the judgment. If you are in this situation, it is important to understand how legal judgments are treated in Chapter 13 bankruptcy. Below is some general information and our attorneys can advise you regarding your specific circumstances.

The Automatic Stay

First, when you file for Chapter 13 bankruptcy, the court will order an automatic stay, which halts all attempts to collect your debts. This includes pausing legal actions against you or attempts to enforce existing judgments. This can include stopping wage garnishments and other forms of collections that cause mental and financial stress.

Repayment Plan and Discharge

In a Chapter 13 case, all of your debts will be wrapped up together and you will make one monthly payment to the court for three to five years. The bankruptcy trustee will pay off your highest priority debts first and then will pay off as much as possible of your unsecured and other lower-priority debts. At the end of your predetermined repayment plan, any remaining debts that are eligible for discharge will be eliminated, which includes many legal judgments.

Judgments That Are Nondischargeable

Bankruptcy courts will not discharge every type of legal judgment, however. Some judgments that can survive a bankruptcy is they are not paid in full by your repayment plan include:

  • Fines and penalties to government agencies
  • Criminal fines and restitution
  • Personal injury judgments or wrongful death judgments from drunk driving accidents
  • Personal injury judgments or wrongful death judgments from malicious or willful conduct
  • Debts arising from fraudulent or criminal conduct, such as embezzlement
  • Child support, alimony, or other domestic orders

If the majority of your legal judgments fall into the above categories, Chapter 13 bankruptcy may not be the solution for you.

Lien Stripping

Some creditors that obtain legal judgments can attach a lien to your property, which will need to be paid before you can sell your property or the creditor will take payment from the proceeds of the sale. Your attorney can advise you whether it is possible to strip those liens in a Chapter 13 bankruptcy case. Lien stripping involves including the liens as unsecured debt in your repayment plan, which can effectively take care of the lien in many cases.

Our St. Petersburg Chapter 13 Bankruptcy Attorneys Can Assist You

If you are facing lawsuits by creditors, injured parties, business partners, or other parties, you may end up with a legal judgment against you that can ruin your finances. If you already have a judgment in place, enforcement of the judgment through garnishment, levies, or liens can also seriously affect your financial situation. In either case, you should discuss your options with a Chapter 13 lawyer at Berkowitz & Myer as soon as possible. Call our office at (727) 344-0123 or contact us online to set up a consultation regarding your debt relief options.

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