Chapter 13 Bankruptcy – Protecting Your Assets
Chapter 13 bankruptcy is also known as ‘the wage earner’s plan’. Filing Chapter 13 allows individuals with a regular income to develop a plan to repay part or all of their debts.
Under Chapter 13, the debtor proposes a three to five year repayment plan to pay their debts. The timeframe for repayment depends on the debtor’s monthly income compared to the applicable state median income. The income used will be based on the most recent six months prior to filing bankruptcy.
Chapter 13 Bankruptcy Advantages
Filing Chapter 13 has a number of advantages over the liquidation process under Chapter 7 Bankruptcy.
- One of the most significant advantages is Chapter 13 offers people the opportunity to protect their homes from foreclosure. You can stop foreclosure proceedings and may correct delinquent mortgage payments over time. Homeowners must still make all mortgage payments coming due during the plan.
- Another advantage of Chapter 13 is it allows people to reschedule secured debts (other than a mortgage for their primary residence) and extend them over the life of the plan. You may even be able to lower payments.
- Chapter 13 also has a special provision protecting third parties who are liable with the debtor on “consumer debts.” Co-signers can potentially be protected by this provision when filing bankruptcy.
- And finally, Chapter 13 resembles a consolidation loan. The individual makes payments to a trustee as planned, who then distributes payments to creditors. Individuals have no direct contact with creditors while under bankruptcy protection.
If you have any specific questions about completing the forms or how to file them, our experienced bankruptcy attorney can help you prepare properly for filing bankruptcy.
Organizing For A Chapter 13 Bankruptcy in Beloit WI
If you are considering filing bankruptcy, you will need to organize your financial information. To complete Official Bankruptcy Forms making up the petition, statement of financial affairs, and schedules, the following information is required.
- What You Owe – List all creditors with amount and nature of each claim
- Your Income – including the source, amount, and frequency of all income sources
- Property – List of all of your property
- Living Expenses – Create a detailed list of your monthly living expenses (food, clothing, shelter, utilities, taxes, transportation, medicine, etc.)
If you are married, you are also required to gather this information for your spouse regardless of the living situation. Whether you are filing a joint petition, separate individual petitions, or even if only one spouse is filing bankruptcy, spousal information must be included. Even when only one spouse files, Chapter 13 bankruptcy, income and expenses of the non-filing spouse is required so the court, the trustee and creditors can evaluate the household’s financial position.
Expert Chapter 13 Bankruptcy Attorney in Beloit WI
In Beloit or Janesville Wisconsin, you can file for Chapter 13 Bankruptcy when you pass a means test. Monahan and Johnson S.C. in Beloit WI has experienced Chapter 13 attorneys ready to assist you with a means test and when filing bankruptcy.
Monahan and Johnson S.C. offer free initial consultations to Beloit and Janesville WI area residents . As experienced bankruptcy attorneys we can assist you with the filing process. Call or email Tom Johnson today at 608-362-8086 for more insight about how to proceed with a Chapter 13 Bankruptcy in Beloit WI.