If you’re filing for Chapter 13 in Los Angeles, you should learn as much as you can bout the benefits and potential drawbacks. Otherwise known as the Individual’s Plan, the Chapter 13, Title 11 of the United States code provides debtors with regular income, the equal opportunity to repay a portion or all of their debt.
Repayment Plan With Chapter 13 In Los Angeles
With this law, the individuals in debt are given a chance to create a repayment plan through their Chapter 13 in Los Angeles. The payment plan allows them to pay the debt, through installments over a three to five year period. The plan gives an opportunity for people, who earn salaries, to be able to pay their debts in installments within a reasonable period. When the Chapter 13 proceedings begin, creditors are no longer allowed to collect money from the debtors, unless given a go-signal by the bankruptcy court.
Consumer Debts And Chapter 13 In Los Angeles
Under this code, consumer debts are considered those that are acquired by a consumer, and business debts are those that are incurred by businesses. This Chapter also demands that people who have filed under the program should willingly provide a part of their future income if necessary, to settle the terms included in the individual’s plan. The eligibility of the people who wants to acquire the wage earners’ plan primarily depends on the amount of secured and unsecured debts in dollar that can be regulated by the statute on a yearly basis.
Once you have filed for the Chapter 13 in Los Angeles, the bankruptcy court then assigns an unbiased trustee to handle all the disbursing transactions including the collection of payments throughout the given time period and handing the said payments to the creditors. When compared to the bankruptcy code, this plan provides benefits that are more distinct. For instance, this chapter gives a chance for debtors to hinder the process of foreclosure and may even address unpaid mortgage payments in an extended period.
This is why it is always important to use a bankruptcy attorney when filing for a Chapter 13 in Los Angeles. You can reorganize your secured debts exclusive of mortgage plans so that they can be included in the plan, which may reduce the debts that you need to pay. For this to work, however, you need to be able to pay for mortgage on time in the throughout the entire plan.
Another additional benefit of the Chapter 13 in Los Angeles is that they can also act as a consolidation loan in which you are able to make payments to the assigned trustee, giving you no direct contact with the creditors while on the plan.
Your bankruptcy lawyer will explain all aspects of the Chapter 13 in Los Angeles and decide with you which one is going to benefit you the most.
