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Chapter 13 Bankruptcy - Things You Need To Know Before Filing Bankruptcy
If you’ve decided to file bankruptcy, but are not you sure whether you’re prepared for it or not, then the first thing you need to keep in mind that it will not make things easy for you. It’s going to be your biggest financial and life changing decision. The procedures and paperwork require are tedious, which is why you need to make well informed choices.
Read on to understand some of the basic facts about filing chapter 13 bankruptcy in Jacksonville Florida, like eligibility requirements, advantages and other facts.
Chapter 13 Bankruptcy
Chapter 13, Title 11, United States Code, is a section that refers to the ways a person sort-out his or her financial status, lead by the federal bankruptcy court. Also termed as the "wage earner's plan", this section allows you pay the debts and keep the property if you have a steady source of income.
Even if your income is less than the state median, then you need to pay off your debts in a period of three to five year. In case your income is greater than the state median, you could need to pay it off within the time specified by the court.
You must keep in mind that under no circumstances, the time period will be extended. There are many benefits of this plan, and one of the important one is that you can keep your property with you.
A Few Advantages of Chapter 13 Bankruptcy
Even if you are not in a good position while filing the Chapter 13 Bankruptcy, a few advantages can definitely help you ease the financial crisis. The benefits include consolidating your debts, saving the house or property from foreclosure and rescheduling the secured debts over the life of plan. By rescheduling the debts, you could lower the payments to more flexible and manageable levels.
When it comes to consolidation of the debts, you have to make all your payments to the trustee in-charge of your case and then they transfer funds to your creditors. Eventually, you’ll end up having no contact with your creditors, which is one of the best things for you.
In order to get the most of Chapter 13 bankruptcy, you should meet to the specific eligibility requirements set by the federal bankruptcy department.
Chapter 13 Bankruptcy Eligibility Requirements
If you want to file bankruptcy then there are several eligibility requirements you are expected to meet.
- You can get chapter 13 relief if your unsecured debts are less than $336,900, and your secured debts are below $1,020,650.00.
- An individual can’t be held eligible if he/she has had a prior bankruptcy petition dismissed in the previous period of 180 days due to a willful failure to appear in the court.
- Third, you have to receive credit counseling from a professional approved credit counseling firm in past 180 days. Also, if there was any debt management plan made by the counseling firm, it should be submitted to the court.
These above said points will certainly help you keep well-informed while making this important decision of your life.
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