What are the top benefits of Chapter 13 bankruptcy?
Chapter 13 bankruptcy is the legal procedure that lets people repay their debts over the course of time while giving them the opportunity of keeping valuable assets, such as a home. One can only apply for this process if he has regular income. It is not like the debt will get forgiven, but rather it will get restructured with a repayment plan of three to five years. There is the flexibility of repayment, which makes Chapter 13 a viable option for the ones who have jobs and steady incomes. Some people consider it a better option than Chapter 7. Here are the top benefits of Chapter 13 bankruptcy.
- You get to keep the house
If you are a homeowner who is behind in the mortgage payments, then you finally get the chance to catch up on those debts. According to the dove law firm, it will save your home from being foreclosed. Many applicants go for Chapter 13 because it allows them to save their precious homes.
- You get to consolidate the payments
You will have to send a check each month to a trustee appointed by the court. The trustee will pay your lenders, which will consolidate your debts. You can even lower the payments based on how well you can negotiate with the creditors.t Don't use plagiarised sources.Get your custom essay just from $11/page
- Your credit reports get way better
The debt will not get repaid as per your original terms. But, you can be happy knowing that all the debt will get repaid under this process. Thus, your credit reports will only suffer for seven years. Your credit report suffers for ten years in the case of Chapter 7 bankruptcy.
- Your co-signers remain protected
Except when authorized by a bankruptcy court, the creditors might not go ahead and try to collect their money from co-signers. This clause can mean a huge relief for the ones who had agreed to take up the liability for their acquaintances or friends.
- You will have more time payback the debts
It might feel tough to keep that roof over the head when you are trying to pay your debts, and there are creditors targeting your property and wages. The protection of bankruptcy courts ensures that you can effectively do both of them. According to the dove law firm, the court’s orders stop the creditors from taking actions as you repay the debt gradually for three to five-year repayment plans.
Now that you know the benefits of Chapter 13, it is time to get a good lawyer to handle the proceedings for you. Go to a reliable law firm near you, and talk to the professionals there to better understand the details of this legal procedure.