How Chapter 13 Bankruptcy Lawyers Help Their Clients Understand the Process

Most people consider seeking bankruptcy protection as something to think about when all other methods of dealing with financial troubles have failed. What some people do not realize is that there is more than one form of personal bankruptcy, and not everyone will qualify for all options. This is where the advice from a chapter 13 bankruptcy lawyer will come in handy. Here is what a client will learn by during a consultation.

Evaluating the Situation of the Client
Before any chapter 13 bankruptcy lawyer provides suggestions to clients, he or she will want to take a good look at the situations those clients face. Depending on the amount owed, the type of assets the client owns free and clear, and the total monthly income currently present, it is possible to see if the client would be better served by filing for a Chapter 7 action. If the client does not meet the criteria for this approach, chances are that filing a chapter 13 bankruptcy action is still possible. At that point, the lawyer will help the client understand how this approach works.

Explaining the Basics
As the lawyer will explain, the chapter 134 bankruptcy does not involve selling assets to settle some debt and then dismissing the rest. Instead, the approach places the debtor under the protection of the court while the debt is repaid. Using a schedule drafted and approved by the court, payments are remitted each month. The court then distributes those payments to the creditors. Once the debts are paid in full, the obligation is considered fulfilled and the bankruptcy is considered complete.

How About Interest and Penalties?
At the time the court takes the bankruptcy petition under consideration, creditors can no longer apply interest, late fees, or other charges to the balance. All attempts to collect on the debts must also come to an end. Once the action is approved, the court will garnish the wages of the debtor and use the payments to settle the debts over a period of several years.

For anyone who is sinking into debt and needs help now, visit and arrange to speak with a lawyer. There is a good chance that this type of bankruptcy will be the most practical way to turn things around and begin looking forward to a more secure financial future.

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