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Bankruptcy Attorney in Greensboro Handles Chapter 13 Matters

Attorney helps High Point residents understand Chapter 13 bankruptcy

Chapter 13 is typically the type of bankruptcy used by consumers if they are trying to save a house or car and are behind on the payments, or if they do not qualify for Chapter 7. While Chapter 13 is not a traditional liquidation bankruptcy, it still can be an essential means to restore your financial health. At Blalock Law Offices, P.A., we help many North Carolinians understand both Chapter 7 and Chapter 13 bankruptcy, including when filing for Chapter 13 may be more advantageous.

Unlike Chapter 7 in which nonexempt property typically is liquidated, Chapter 13 exemptions are designed to let you keep your property and assets by paying back your creditors. To pay back your creditors, Chapter 13 requires a three to five year payment plan. Under this payment plan, you pay back a portion of the debts you owe to creditors. Provided you make all your payments on time and in full, at the end of the payment plan, your remaining dischargeable debts are also wiped clean.

What are the advantages of Chapter 13?

The first advantage of Chapter 13 is that there is no means test to qualify. Rather, the Chapter 13 means test influences the payments and duration of the payment plan. If you are harassed by creditors, Chapter 13s automatic stay stops the calls and notices by law. Additionally, under Chapter 13, certain debts that Chapter 7 cannot discharge are dischargeable, such as:

  • Nondischarged debts from a previous bankruptcy
  • Debts from nondischargeable tax debt
  • Retirement loan debts
  • Court fees
  • Home owner association fees incurred after filing

Furthermore, Chapter 13 can also have benefits, depending on the type of debt you have taken on. Chapter 13 can:

  • Consolidate bills into one monthly payment
  • Reschedule secured debts
  • Protect cosigners to your loans
  • Stop foreclosure
  • Cure delinquent mortgage payments

Are there disadvantages of Chapter 13?

While there are many advantages of Chapter 13, there are also some drawbacks. To begin with, Chapter 13 is not available to corporations. It essentially requires you to live on a fixed income for three to five years. Moreover, you are typically not permitted to take on new debt without first obtaining Bankruptcy Court approval.  An experienced Greensboro attorney can help you further understand the advantages and drawbacks and how to file for Chapter 13.

Contact us to get a clearer understanding of Chapter 13 bankruptcy

I have helped numerous North Carolinians understand bankruptcy and their best means to achieve financial health. Blalock Law Offices is conveniently located across from the Friendly Center. If you think you are out of options, please call us at 336-609-6878 or contact us online for your free consultation.