Chapter 13 Bankruptcy Attorneys in Phoenix, Arizona
A Phoenix Chapter 13 bankruptcy is a bankruptcy filed with a repayment plan. The Ch 13 proposes to the court that the debtor pays back some or all of their outstanding debt to creditors. Therefore, in most cases the debtor will only pay back a portion of the outstanding debt that are owed to creditors.
How long will a Chapter 13 bankruptcy take?
How much will a Chapter 13 bankruptcy cost?
What is a bankruptcy means test?
What Happens at the End of your Repayment Plan?
Once you complete your repayment plan term then the remaining dischargeable debt that was not paid back during the term of your plan will be discharged. This means that you will no longer be personally liable for the payment on these debts.
Easy Steps to a Phoenix Chapter 13 Bankruptcy:
- The Debtor Files a Phoenix Chapter 13 with our experienced bankruptcy attorneys.
- Debtor makes monthly payments to the bankruptcy trustee.
- Ch 13 Payments are made to the trustee for 36-60 months.
- The Trustee distributes payments to the debtor’s creditors.
- Debtor receives Chapter 13 bankruptcy discharge and has their “Fresh Start”.
Chapter 13 bankruptcy is an interest-free repayment plan on your debts that you can actually afford, one that you can pay off over time (usually 3 to 5 years). It is overseen by the Bankruptcy Court to make sure everyone plays by the rules, and it allows you to pay your creditors back on terms that are favorable to you, without any interest. This is different from a Chapter 7 filing, which simply liquidates your assets in order to pay back creditors. Unlike Chapter 7, Chapter 13 bankruptcy allows you to keep your home or your car, even if you have been behind on payments.
Furthermore, all of your creditors are paid with a single monthly payment to the Bankruptcy Trustee rather than multiple payments to different creditors due at different times during the month. This payment satisfies all your debt obligations, rather than just one creditor being paid. Chapter 13 also doesn’t negatively affect your credit the way a Chapter 7 would.
Filing Chapter 13 Bankruptcy to Save Your Home from Foreclosure
If you are facing a foreclosure on your home in Phoenix, declaring bankruptcy may be the answer. One of Chapter 13 allows you to stop an effort to foreclose on your home. Filing a Chapter 13 petition suspends any current foreclosure proceedings and payment of any other debts owed. This buys time while the court considers the plan, but it does not eliminate the debt. Hopefully, the bankruptcy plan will free enough of your income that you’ll be able to make regular mortgage payments and keep your house.
How do I know if Bankruptcy Chapter 13 is the right option for me?
- If you need to prevent a foreclosure on your home, or a repossession of your vehicle
- Are you are getting wage garnishments & harassed (or sued) by creditors
- Trying to eliminate a 2nd or 3rd mortgage and your home is valued below the 1st mortgage
- You have monthly income or wages, and you don’t qualify for a Chapter 7
- If you have certain debts like unpaid income taxes, a student loan, or child support, all of which cannot be discharged in Chapter 7. Again, Chapter 13 allows you to pay these back over a 3 to 5 year period with no interest
- You have a co-debtor on a personal debt. If you file for Chapter 7 bankruptcy, your co-debtor will still be on the hook — and your creditor will undoubtedly go after him/her for payment. If you file for Chapter 13 bankruptcy in Las Vegas, the creditor will leave your co-debtor alone as long as you keep up with your (interest-free) bankruptcy plan payments
The “Means Test” – When Declaring Bankruptcy is the only option.
In 2005, Congress created a new bankruptcy law. The new bankruptcy law says, if anyone who files for Chapter 7 must show that their monthly income is below the average income for people in their area. This is called the “means test.” If your income is above the designated average and you wish to file for bankruptcy, then you’ll be required to file Chapter 13 instead of Chapter 7. At your initial consultation, we’ll help you figure out which chapter is best. Therefore, you’ll either be eligible for Chapter 7. If not, a Phoenix chapter 13 bankruptcy may be best for you.
How long will my Ch 13 Bankruptcy case take, and what’s required of me?
We can get the process started very quickly and start protecting you right away regarding many of your debts, including foreclosure of your home. Chapter 13 bankruptcy cases usually take 3 to 5 years to complete, depending on the kind of debt you have as well as the amount. Your role in the process will be to make monthly payments during that time. You will also need to attend a few simple administrative hearings. These hearings are typically short and relatively informal, and we’ll be there with you to hold your hand and make sure it all goes smoothly.
Costs: How much do I have to pay to file for Chapter 13 bankruptcy in Phoenix?
The filing fee to the Bankruptcy Court is $281. Attorney fees vary based on the complexity of your case, and most of the attorney’s fees can be paid as part of your Chapter 13 payment plan (without interest). Typically, a bankruptcy attorney’s fee ends up being a very small percentage compared to the total amount of debt you are able to eliminate.