Chapter 13

Chapter 13 Bankruptcy provides a method for repaying a percentage of your debts, interest free, over a period of time generally based upon your ability to pay. A Chapter 13 allows you to stop foreclosures, catch up on past due mortgage payments, restructure your car loan and pay off your other debts according to a court approved plan of reorganization. In most cases, your monthly payments will be dramatically reduced.

A Chapter 13 “reorganization” is a powerful tool to assist in our overall analysis of troubled mortgages. If a client would like to try and keep a home after they have fallen behind on their mortgage, a Chapter 13 will stop any foreclosure lawsuit and allow the homeowner / borrower to keep the home provided that they can make their payments to the Chapter 13 Trustee.

Chapter 7

Chapter 7 Bankruptcy affords you an opportunity to discharge debts, bills and financial obligations, while allowing you to keep exempt personal property. In most circumstances, this will allow most clients to keep most of their assets. A Chapter 7 Bankruptcy is designed to give families or individuals a fresh financial start without being burdened by old credit cards, bills and judgments.

A consultation with a bankruptcy attorney is crucial in evaluating these options and determining whether you qualify for a Chapter 7, a Chapter 13, or neither.