Workable options for wage earners with troubling debt in Ventura County
The Law Offices of Michael H. Raichelson has helped a wide range of people throughout Ventura County and Los Angeles County take control of their financial situation and get a fresh start through a Chapter 13 bankruptcy. While not as well known as Chapter 7, Chapter 13 bankruptcy is usually easier to qualify for and has many advantages. Our Woodland Hills & Oxnard bankruptcy attorneys personally work with each client to demystify the process and help him or her see if personal bankruptcy is the right decision.
What is Chapter 13 bankruptcy?
Chapter 13 bankruptcy is often referred to as a “wage earner's plan,” “individual debt adjustment” or simply a “repayment plan.” It allows you to consolidate all of your debts and creditors into a single, manageable repayment plan where you pay some or all existing debt over a three- to five-year period. The repayment plan is based on your current monthly income, which can include wages from employment, Social Security benefits, pensions, contribution from family or friends or any other regular stream of income.
With the guidance of an experienced Oxnard & Woodland Hills chapter 13 bankruptcy attorney, you can ensure the plan allows you to meet your obligations while relieving the stress of having to deal with the demands of multiple creditors. Moreover, unlike private debt consolidation, this process takes place under the supervision and protection of a United States bankruptcy court.
You might be asking, “Can I file for Chapter 13?” There are many bankruptcy myths that prevent people in Northridge and Van Nuys who may qualify for either Chapter 7 or Chapter 13 bankruptcy from choosing the best option. The typical person filing for Chapter 13 bankruptcy is someone who has accumulated tax debts or fallen behind on mortgage, car or medical payments due to a sudden illness, divorce or unemployment. He or she may also have significant student loan or child support debts that are not dischargeable under Chapter 7 bankruptcy. In addition, he or she may have attempted other forms of debt relief but were unable to get results.
There are certain advantages to Chapter 13 bankruptcy, even though you will not be able to eliminate your debts completely as you might under Chapter 7:
- Available to some whose income is too high to qualify for Chapter 7
- Does not require you to liquidate your property
- Better for dealing with secured debt or saving your home
- More favorable rules regarding what debts are dischargeable
How does Chapter 13 bankruptcy work?
Like other forms of bankruptcy, filing for Chapter 13 institutes an automatic stay that halts collection actions and foreclosures. The Law Offices of Michael H. Raichelson works with you to draft a payment plan for submission to the bankruptcy court. A court-appointed trustee then holds a meeting with your creditors to discuss their claims and your finances.
After the creditor meeting, the court holds a hearing where the repayment plan is deemed acceptable or in need of adjustment. If the payment plan is accepted, you are no longer charged interest on your debts. Your creditors are now legally bound to abide by the plan and can no longer harass you with constant phone calls and threats. Over a span of three to five years, your payments are applied to the principal balance of each debt, which will ensure your total debt is paid off as soon as possible. If you make the payments the plan requires for the entire term, the court will typically discharge any remaining unsecured debts.
Personal bankruptcy is a powerful and effective tool that must be used carefully. It is not a process to be taken lightly and the guidance of our experienced Oxnard & Woodland Hills chapter 13 bankruptcy attorneys are the key to securing a new beginning for you and your family.
Learn more about how Chapter 13 bankruptcy can help you
At Raichelson Law, P.C., we are committed to helping our clients during the bankruptcy process and after, offering cost-effective and compassionate legal services and ensuring that you have the knowledge to preserve your newfound financial freedom. For more information about Chapter 13 bankruptcy, contact us by phone at 818-444-7770 or reach out to us online to schedule a free initial consultation.