Making the decision to file for bankruptcy can be one of the hardest things you ever do. If you’ve been struggling with unmanageable debt for some time, however, it might be just the right decision to help you move forward.
Chapter 13 bankruptcy is one of the available options if you’re considering taking this financial step. Under this chapter, you can set up a repayment plan which allows you to put together a repayment plan to make your debts easier to manage.
It might sound obvious but these are the most important debts and ones that need to take priority over other debts.
These can include such payments as tax obligations, child support and if you own your own business, any back wages you owe to your employees.
These are the most common types of debt people have outside of their mortgage and vehicle loans. They’re called “unsecured debts” because there’s no form of collateral behind them. Examples of these include credit card balances, personal and payday loans and medical bills.
With a mortgage or car, if you fall behind on your repayments there’s a tangible piece of collateral that they can take from you. These debts are secured by the property or car which is why they are so named.
These are usually people’s biggest concerns as of course no one wants to be in a position where their house or car has been repossessed. So long as you can continue affording to make a monthly payment, these debts can be included in your repayment plan. If you are delinquent on your car or house, Chapter 13 is one way you can keep them without immediately catching up.
As previously mentioned, opting for bankruptcy is a tough decision and one that needs to be made with full knowledge of how it will affect you. It’s important to understand how a repayment plan works so you can decide whether this is the right step for you to take. Contact an attorney to discuss your options.