Bankruptcy Lawyer in Salem

What is Chapter 13 bankruptcy?

Chapter 13 bankruptcy allows a debtor with regular income to create a repayment plan for some or all of their debts. Also referred to as a wage earner's plan, Chapter 13 allows the debtor to save their property from liquidation or their home from foreclosure while paying off their debt over a three to five year period.

To qualify for Chapter 13, the debtor must be able to prove to the court that they have sufficient income to meet the regular payment obligations. There are restrictions on the amount of debt that the debtor can have to qualify for Chapter 13. The debtor's secured debts are those that the creditor is entitled to reclaim in the event of nonpayment, such as a house or car, and they cannot exceed $1,010,650.00. The debtor's unsecured debts, such as medical bills or credit cards, cannot exceed $336,900.00.

When filing a Chapter 13 petition, the debtor must also file specific items of their finances with the court. The debtor is required to file schedules of their assets and liabilities, schedule of their current expenditures and income, schedules of their unexpired leases and executory contracts, and an official statement of their financial affairs. The debtor must also provide the court with a certificate of credit counseling and a repayment plan created during credit counseling, evidence of employment and payment, a monthly net income statement that lists any expected increases in income or expenses, and a record of any interest in qualified federal or state education or tuition accounts. The debtor will need to provide the Trustee will require various tax documents and financial information during the bankruptcy proceedings.

Chapter 13 Bankruptcy Assistance in Salem

If you are considering filing for Chapter 13 but are unsure of where to start or if you qualify, a Salem attorney may be able to help. We know that this is a stressful and confusing time, but our experience and knowledge of bankruptcy law may be able to guide you through your options. If you should choose to file Chapter 13 bankruptcy, or if you decide that Chapter 7 is a better solution for you, we may be able to assist you throughout the entire process. Call the Law Offices of Sarah S. Rama today for your free initial consultation!

Contact a Salem bankruptcy attorney if you are filing for Chapter 13 bankruptcy.