Being in a position where you are unable to pay bills such as your mortgage, car payment and property tax can be terrifying. It seems that once you are late it snowballs out of control almost immediately. As frightening and stressful as this experience is it is important to know that you do have debt relief options that will prevent you from losing your home, car and other assets.
If you would like to learn more about your debt relief options to you should speak with our Orlando bankruptcy lawyers at Lyons Law. Dial (407) 476-3437 for a free consultation. We represent those struggling with seemingly insurmountable debt throughout the Orange County, Polk County, Seminole County, Brevard County, Osceola County, Lake County and Volusia County, Florida areas.
Chapter 13 Overview
If you want to keep certain assets or property filing a Chapter 13 bankruptcy may be the right choice for you. A Chapter allows you to consolidate debt and repay over a 3 to 5 year time period. Chapter 13 bankruptcy provides debt relief for:
People with severe arrears on a mortgage who wish to avoid foreclosure
Those whose income is too high to qualify for Chapter 7 bankruptcy
People with child support arrears
People with spousal support arrears
By filing a Chapter 13, your attorney and the bankruptcy trustee will negotiate a repayment plan to repay a portion of your debts over a period of 3 to 5 years. The payments are based upon your disposable income after household expenses and the type of debt owed. You will make monthly payments for 36 to 60 months.
After that, any remaining debts are discharged and you are in the clear. A common misconception about filing Chapter 13 bankruptcy is that you will lose everything and nothing could be further from the truth. Upon filing foreclosure proceedings, repossessions, or other collection actions are immediately stopped and your creditors must cease contacting you.
This means that creditors cannot call your home, harass you or threaten lawsuits. In addition, you will not forfeit any assets or possessions provided you qualify.
In 2005, Congress instituted a bankruptcy means test. If you earn more than the Pennsylvania median income, you may be required to file for Chapter 13. Although you must make payments, most Chapter 13 repayment plans settle your debts for a fraction of the total you owe.
To learn more about your options for obtaining financial relief contact Orlando Bankruptcy Attorney Meg Lyons for a free consult.
What is Ch. 13 Bankruptcy?
Chapter 13 bankruptcy is a repayment plan for individuals and sole proprietorships who have steady and above the median incomes, and usually own assets. In Chapter 13, you must propose to the Court to pay back all or a portion of your debt over the life of the plan, which will either be three or five years, dependent on income. If the court approves the plan of payment and all of the payments are made, the debts are settled in this manner, even if the debtors’ creditors object to the plan. If the Debtor makes the payments as required pursuant to the plan approved by the Court, the Debtor will not be required to surrender the property to a trustee and all assets can be retained and liquidation avoided.
Home Retention & Ch. 13 BK
Filing a Chapter 13 bankruptcy has its unique advantages over a Chapter 7. One of the distinctions between the two is that Chapter 13 may be employed for the purposes of home retention, provided that the property is homesteaded properly in Florida. A Debtor can invoke the protection of the “automatic stay” to cancel the sale of a foreclosure by the filing of a Chapter 13. A foreclosure sale can be stayed in Chapter 7 as well, however, there is no guarantee of home retention in that case, but the bankruptcy will eliminate the Debtor’s personal liability with regard to the mortgage obligation. Once the Chapter 13 is filed, the Debtor has the opportunity to cure the arrearages that are owed toward the mortgage debt while also making the current monthly payment during the life of the plan. The Chapter 13 bankruptcy procedures also allow you to “strip” mortgages and obtain loan modifications.
Family Law Attorney Meg Lyons proudly serves the greater Orlando metropolitan area including Orlando, Kissimee, St. Cloud, Buenaventura Lakes, Sanford, Oviedo, Longwood, Casselberry, Lake Mary, Apopka, Winter Springs, Altamonte Springs, Daytona Beach, South Daytona, New Smyrna Beach, Port Orange, Ormond Beach and Volusia, Florida.
‘We are a debt relief agency. We help people file bankruptcy under the Bankruptcy Code’.