3 Things You Need to Know about Chapter 13 Bankruptcy in Naperville Before Filing

Knowing how to file for bankruptcy can be tricky, especially if you have existing student loans, have to pay for child support or alimony, or outstanding medical bills. Chapter 13 Bankruptcy in Naperville outlines that as long as you are an individual earning a regular income, you will be able to work with a lawyer to create a repayment plan that fits your needs. You will then have to ability to file for bankruptcy under Chapter 7 or Chapter 13. Chapter 7 is a little different from Chapter 13, as it does not give debtors the option to pay back debt in smaller portions. Chapter 7 bankruptcy is reserved for those who have no disposable income and no assets, and must liquidate all debt at once.

The Eligibility Process

Anyone is eligible for relief, whether they work for a business or are self-employed. Their debt must be lower than $383 thousand and can fluctuate due to CPI. One cannot file for bankruptcy if the debtor has not received credit counseling within 180 days of filing. If creditors decide to find relief from courts, the debtor’s bankruptcy petition is dismissed.

Advantages of Chapter 13

By filing under Chapter 13, individuals are able to stop foreclosures on their home and procure delinquent mortgage payment options. Chapter 13 will also protect those who may be liable to consumer debt or co-signers. Individuals are allowed to reschedule debt payments as well for student loans, car loans, or mortgages. Having a job helps debtors pay off their overdrafts in monthly increments without worrying about defaulting.

Giving You a Second Chance

Under the Chapter 13 Bankruptcy in Naperville, you are given a chance to save your home from being foreclosed and debt such as child support and student loans won’t be discharged. If an individual fails to comply, he or she will have to file under Chapter 7 bankruptcy, which will force the debtor to liquidate his or her assets and foreclose their property. Since Chapter 13 requires monthly debt payments, the process exists for 3 to 5 years so creditors can provide thorough bankruptcy help to debtors.

For any extra questions and confusion you may have, a lawyer will be able to extrapolate the finer point of Chapter 13 bankruptcy laws for you. Filing for bankruptcy does not have to be stressful; having a plan of attack will help you tremendously in the long run.