Chapter 13 Bankruptcy FAQs and answers too
What is a Chapter 13 Bankruptcy?
Chapter 13 is designed to help you save property, like your house or your car, if you have fallen behind on your payments and are facing foreclosure or repossession. When you file Chapter 13, we set up a payment plan whereby you pay back your missed mortgage payments and missed car payments over a three to five year payment plan.
You also pay back other debts in a Chapter 13, including credit card debts, medical bills and loans. Sometimes we can create a payment plan in which you pay back these other debts at less than 100%. By law you are required to include all of your debts in your Chapter 13 plan. In addition, you have to pay your Chapter 13 plan through a payroll deduction filed with your employer.
If you file Chapter 13, you will likely need to attend one very brief, informal hearing. Click here to learn what happens at a Chapter 13 meeting of creditors hearing and what potential problems (objections) can crop up.
What do I have to do to file Chapter 13?
Stittleburg Law Office no longer handles Chapter 13 cases. If you need a referral, please give me a call.
Outside of any attorney fees, you will incur some minimal costs relating to a legally required credit counseling session, varying between $15.00 and $50.00 depending on which company is used. Current bankruptcy laws require a debtor to attend a credit counseling session prior to the filing of a bankruptcy case. Additionally, prior to receiving a discharge, a debtor must complete a debtor education course, with costs varying again between $15.00 to $50.00 depending on the company used. Both the credit counseling session and the debtor education course can be completed on line or over the phone. If you need a referral to companies offering these services, please call my office at 770-396-4323.
Will I lose everything if I file for Chapter 13 bankruptcy protection?
The thought of losing property because of the filing of a bankruptcy case scares many people. Many also have private 401(k) accounts, government retirement accounts and personal private pensions or other investments that they think will get seized and used to pay creditors.
When you file a bankruptcy case, the courts allow you to exempt some of your property such as a portion of your real estate equity, your personal property and your retirement money. Much of this is safe and sheltered from the reach of the Bankruptcy Court by virtue of a Georgia law called the exemption law. if you want to read the Georgia Exemption Statute, click here. The Georgia exemption law sets out specifically what you can protect if you file a bankruptcy. For a report on the Georgia Exemption laws, please click here. The report discusses what you will be able to keep and what property might be at risk.
Can I file even if my spouse doesn’t want to?
You are permitted to file an individual case, even if you are married. If you file individually, and you have co-signed or joint debts, you can pay the co-signed debts in full as a special payment class in your Chapter 13 plan. In most cases, you can pay co-signed debts at 100% even if you are paying other debts at 5%.
If you choose not to protect your co-debtor in your Chapter 13 plan, the creditor can ask the Judge for permission to collect and sue the co-debtor.