If you have overwhelming debts, face foreclosure on your home, car repossession, or wage garnishment, a Chapter 13 bankruptcy petition will give you a new opportunity in life. As an experienced Delaware County bankruptcy attorney in Boothwyn, PA, Michael T. Malarick, is available to assist you with the decision to file bankruptcy and, if so, whether to file a Chapter 7 or Chapter 13 petition. Call our experienced Chapter 13 bankruptcy lawyer today for a free initial consultation.
Experienced Delaware County Chapter 13 bankruptcy lawyer Michael T. Malarick, is available to handle your Chapter 13 bankruptcy matter in and around the following areas of Philadelphia and Delaware County, PA: Boothwyn, Upper Chichester, Aston, Drexel Hill, Marcus Hook, Bryn Mawr, Chester Heights, Aldan, Pilgrim Gardens, Glen Riddle, Lenni, Morton, Stafford, Concordville, Thornton, and more.
In a Chapter 13 Reorganization petition, the debtor lists their income, property, expenses, and debts. With the disposable income remaining, the debtor proposes a workable repayment plan that will last 3 to 5 years. In order to file a Chapter 13 petition, the debtor must have a regular source of income and some disposable income remaining after allowable expenses have been paid.
The Advantages and Disadvantages of A Chapter 13 Petition – Delaware County Chapter 13 Bankruptcy Lawyer
The advantages of a Chapter 13 Reorganization bankruptcy petition are:
- If you can afford the repayment plan, you may be able to keep all of your exempt and non-exempt property;
- You can keep your home out of foreclosure, if you keep up with your repayment plan;
- The amount of debt may be reduced;
- You get immediate protection from collection efforts and wage garnishment;
- More debts are considered dischargeable;
- Co-signors to your debt will be immune from collection efforts, if your plan provides for full repayment; and
- You are provided with more time to pay your debts.
The disadvantages of a Chapter 13 Reorganization Petition
- The repayment plan ties up your disposable income over the life of the repayment plan;
- The costs and fees are higher as a Chapter 13 filing is more complex;
- You are involved with the bankruptcy court over the 3 to 5 year life of the repayment plan; and
- Stockbroker and commodity traders cannot file a Chapter 13 petition.
What is Paid Through the Repayment Plan – Delaware County Chapter 13 Bankruptcy Lawyer
Your repayment plan will address administrative claims, priority debts, secured debts, and unsecured debts. These are paid as follows:
- Administrative claims: these are the filing costs, trustee’s fees, and the bankruptcy attorney’s fees associated with the bankruptcy filing and are paid at 100%.
- Priority debts: These are back alimony and child support, tax arrearages, and wages owed to others including employee benefit funds and are paid at 100%;
- Secured debs: These are debts secured by collateral (such as your home mortgage or car loan) and are paid at 100%; and
- Unsecured debt: These are debts not secured by collateral (such as credit card or medical bills) and are paid at 0 to 100% depending on the total amount of non-exempt property and the amount of available disposable income.
When your repayment plan is accepted by the bankruptcy court, you must make your monthly payments to the bankruptcy trustee.
Mortgage and Foreclosure in a Chapter 13 Bankruptcy Petition – Delaware County Chapter 13 Bankruptcy Lawyer
If you are in or near foreclosure on your home, Chapter 13 permits you to make up your mortgage arrearages through your repayment plan. Then, if you maintain your current monthly mortgage and your monthly trustee payments, you will keep your home.
If you are in foreclosure litigation, the automatic stay of bankruptcy stops the foreclosure process and allows you time to make up the mortgage arrearages.
If you have junior mortgages (such as a second mortgage or a home equity line of credit) which are no longer secured by the equity in your home, those loans may be stripped off and become simply unsecured debt which are repayable at an amount indicated by your disposable income and repayment plan.
As an experienced Delaware County Chapter 7 Bankruptcy lawyer, Michael T. Malarick is able to help you determine whether a Chapter 7 or Chapter 13 bankruptcy petition is right for you. For help with your PA Chapter 13 Bankruptcy petition, contact Delaware County Chapter 13 bankruptcy lawyer Michael T. Malarick located in Boothwyn, PA for a free initial consultation today.
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