Recent Posts in chapter 13 plan Category

Bankruptcy can save your home from foreclosure!

The moment a bankruptcy case is filed with the bankruptcy court the automatic stay comes into effect. The automatic stay prevents creditors from taking certain actions against you including foreclosing on your property.

 Bankruptcy will even stop a foreclosure if filed minutes before the foreclosure sale.

Once the case is filed and the foreclosure stopped you may be able to catch-up missed mortgage payments during the course of a chapter 13 plan, eliminate second or third mortgages, or have time to work out a modification with the bank.

Chapter 13 bankruptcy is a payment plan. In chapter 13 the debtor makes a reasonable monthly payment based on his or her income and expenses. Whatever does not get paid back to creditors through the plan is discharged and you never have to repay again.

In order to determine the amount of the monthly payment we first look to the debtor’s income and then take off deductions for living expenses. Such as utilities, rent, mortgage, car loan payments, food, gas, retirement contributions, and life insurance to name a few.

With some careful planning we can reduce the amount of the chapter 13 plan payment. The simplest way to reduce the payment is to increase the amount of you contribute to your employee retirement plan. For every dollar you contribute you have to pay one less dollar to your creditors. However, your contribution cannot exceed 15% of your annual salary.