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Chapter 13 bankruptcies are meant for wage earners

On Behalf of | Jun 20, 2018 | bankruptcy |

A Chapter 13 bankruptcy is one type that a consumer might file. Unlike the Chapter 7 filing, a Chapter 13 means that you are going to have to make repayments to the court for some of the debts. This form is often called the wage earners plan since you need to have an income so that you can make the payments.

One thing that some people appreciate about Chapter 13 filings is that they can often stop a foreclosure proceeding when they file. This is because the terms of the bankruptcy might enable them to have the means to pay the mortgage. It is important to note that all payments for the mortgage must be made on time through the course of the bankruptcy.

The payments that you make to the bankruptcy trustee will be made on a set schedule. While you are making these payments, you likely won’t have much extra money to do things once your normal bills are paid. This is due to the structure that is set for the payments. Once you have made all payments according to the schedule that is set, any remaining balance with the creditors that were involved in the case will be discharged.

It is imperative that you make on-time payments on your other bills during the course of the bankruptcy. This includes spousal support or child support payments since these must be current in order for the bankruptcy to be finalized.

If you are considering a Chapter 13 bankruptcy, remember that getting your case filed sooner can mean that you experience the relief of the program faster. This could help you have reduced stress in your life.