Chapter 13 bankruptcy is a process where the debtor reorganizes their debt. It is different from a Chapter 7 for many reasons. The biggest difference is that Chapter 13 is a longer process and debts are repaid as opposed to immediately being discharged from your debts. There are numerous reasons why a debtor would file Chapter 13, but it is a big commitment and not a decision that should be made without consulting an attorney.
Reasons for Filing Chapter 13 Instead of Chapter 7
- Too Much Income
- Keep Assets
- Avoid Foreclosure
- Tax Debt
Another reason to file a Chapter 13 is foreclosure. Most debtors want to keep their home despite being in foreclosure proceedings. Chapter 13 is the most efficient way to do that as there are mortgage mediation programs designed to work out a solution for both the creditor and the debtor.
The timeline for a bankruptcy also allows for the debtor to pay back the overdue balance owed on the mortgage, as the average Chapter 13 lasts three to five years. Chapter 13 will normally be the best option for any debtor who wants to save their home. you determine whether you should file a Chapter 13 to save your home.
Chapter 13 is a complicated process and not one that a debtor should go through alone. There is too much at stake: your home, your assets and your income are all seriously affected by the decision you make in choosing whether to file a Chapter 13.
Jeff Kelly is an experienced and knowledgeable Rome GA Chapter 13 bankruptcy lawyer and will help you navigate the tough waters that make up a Chapter 13 case.
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