Just about everything in life has its pros and cons. Filing for Chapter 13 bankruptcy is no different. If you are considering a bankruptcy filing, it is okay to take the time to determine if the positives of taking such a step outweigh any potential negatives. An experienced bankruptcy attorney can assist Ohio residents in deciding what, if any, legal options – such as Chapter 13 filings — would best to help them deal with their financial struggles.
What is the purpose of a Chapter 13 filing?
If you apply for a Chapter 13 bankruptcy, you are basically asking the court to combine your debts and set up a simple repayment plan. If the petition is approved, you will be given anywhere from three to five years to pay off the included debts.
Chapter 13 pros
A Chapter 13 filing can have quite a few benefits. The biggest of them being setting up a repayment plan that fits within your budget. This alone is pretty significant. Along with creating a payment plan that is affordable, a benefit specifically for homeowners is that a Chapter 13 filing, if approved, can help stay foreclosure and allow people to keep their homes — which would not be offered in other types of bankruptcy filings. Some other benefits include the following:
- Co-signer protections
- Bankruptcy credit reporting lasting only seven years
- Protection from creditors
Who can apply for a Chapter 13 bankruptcy?
The intent of this type of bankruptcy is to help those who have steady incomes but, for one reason or another, are finding it difficult to meet their debt obligations. In order to be eligible, one’s unsecured debts cannot be more than $383,175 and secured debts cannot be more than $1,149,525. These numbers are adjusted occasionally, but these are the current numbers according to the U.S. Court system.
How do I apply for Chapter 13 bankruptcy?
The bankruptcy process can be highly complex. There is more to it than filing a petition with the court and waiting for a response. It requires filing petitions with all the necessary documentation, going through credit counseling if required, paying fees, attending hearings and providing a repayment plan for consideration, among other things.
The thought of filing for bankruptcy, Chapter 13 or otherwise, can be disheartening for a lot of Ohio residents. However, at the end of the day, if you need financial help, it is okay to take the steps necessary to receive it. An experienced attorney can be there to assist you at every stage of the bankruptcy process in order to ensure your best interests are being represented.