How To Develop a Chapter 13 Bankruptcy Plan

The choice to file with a Chapter 13 bankruptcy attorney in San Antonio allows you to begin a journey towards debt relief. Chapter 7 bankruptcy attorneys in San Antonio are able to help you get a completely fresh start, but deciding to go with Chapter 13 lets you continue to repay your debts with lower monthly payments. Although a Chapter 13 bankruptcy remains on your credit report for 10 years, it still demonstrates that you were committed to repaying your debt as opposed to simply erasing it.

How The Payment Plan Works


When you file for Chapter 13 bankruptcy, your San Antonio bankruptcy attorney will assist you in developing a repayment plan. The resulting plan will detail a certain amount that you must pay monthly to a bankruptcy trustee, who will in turn begin to repay your debts. Certain debts must continue to be paid in full, which will affect the amount of your monthly payments. The debts that must be paid at a rate of 100% include:

-    Administrative costs: the fees that pay your bankruptcy trustee and lawyer
-    Priority debts: obligations that cannot be dismissed, such as taxes, alimony, and child support
-    Mortgage expenses: the default on your mortgage that must be paid in order to keep your house

Unsecured debts may be adjusted to ensure that you owe lower monthly payments going forward. Expect to negotiate with your lawyer and the court to determine the amount of your disposable income that must be directed towards your debts. The point of a Chapter 13 payment plan is to institute monthly fees that are manageable, so that when you complete the plan you are ready for the fresh start offered by Chapter 7 bankruptcy.

The Chapter 13 Plan Timeline


In order to allow you a clean slate at some point, there is a cutoff time for Chapter 13 payment plans. At that point, all remaining debts are forgiven and you are free from all monthly payments. The length of your plan is determined by the size of your income. Debtors with income that exceed the median income for households of a similar size are required to continue payments for a period of 5 years in order to more fully repay their debts. However, individuals with an income that is less than the median income must only persist with their monthly payments for 3 years.

Ask your Chapter 13 bankruptcy attorney in San Antonio for assistance in developing a payment plan that will help you erase your debts.

By | 2017-11-07T10:27:16+00:00 March 27th, 2013|Chapter 13 Bankruptcy|Comments Off on How To Develop a Chapter 13 Bankruptcy Plan

Chapter 7 versus Chapter 13 Bankruptcy

In considering a Chapter 7 or Chapter 13 bankruptcy attorney in San Antonio, it is important to understand the differences between the two cases. Either option will give you immediate debt relief, as a court order bans all creditor harassment once you file. A San Antonio bankruptcy attorney can clarify for you the expectations and results of a bankruptcy case, whether is it Chapter 7 or Chapter 13.

Chapter 7 considerations


If you file for Chapter 7 bankruptcy with an attorney in San Antonio, your debts will be discharged and assets that are not exempt will be liquidated to repay those debts. Eligibility for Chapter 7 is determined through a “means test.” Debtors with an income higher than the state median income are generally disqualified.

What are the advantages of filing for Chapter 7 bankruptcy? Most importantly, the majority of debts are completely forgiven. Debt collectors must stop harassing you and your family. In Texas, further advantages come from the state’s liberal exemption laws.

However, there are many negative repercussions to be considered as well. Although most debts are forgiven, certain financial obligations cannot be discharged, such as student loans, taxes, and child support. Bankruptcy remains on your credit score for ten years. A Chapter 7 San Antonio bankruptcy attorney can help you decide if a Chapter 7 case is appropriate for you.

Chapter 13 issues


A Chapter 13 bankruptcy attorney in San Antonio will explain to you the benefits of choosing debt consolidation as opposed to a discharge with Chapter 7. When you file Chapter 13 bankruptcy, you are granted lower monthly payments in order to achieve your debt relief. A repayment proposal must be submitted to the court that suggests a reasonable plan for repayment of your debts based on your income.

The pros of a Chapter 13 bankruptcy case include the protection of your assets under the Texas exemption laws. These exemptions will reduce the amount of money that the court deems you must repay. Choosing Chapter 13 allows you to continue with lower monthly payments in your plan. A lawyer can assist you in understanding how the Chapter 13 laws apply to you.

For a reliable San Antonio bankruptcy attorney, contact us.

By | 2017-11-07T10:27:16+00:00 March 2nd, 2013|Bankruptcy|Comments Off on Chapter 7 versus Chapter 13 Bankruptcy