If you are reading this, you are probably already considering filing for bankruptcy in the state of Ohio. It is important that you are aware of the different options available to you under federal law, which include filing for Chapter 7 or Chapter 13 bankruptcy. As a dedicated bankruptcy lawyer, Thomas D. Berry can discuss your situation with you and help you decide which option is best.
What is Chapter 13 Bankruptcy?
Chapter 13 permits the individual filing for bankruptcy to consolidate their unsecured debts and repay them, interest-free, over a time period of three to five years. It is an alternative form of bankruptcy designed for individuals who do not qualify for Chapter 7, or for those who wish to protect non-exempt assets from liquidation. Filing a petition for Chapter 13 bankruptcy relief will immediately stop phone calls and letters from creditors and collection agencies. It will also delay your bank from foreclosing on your home.
In order to qualify for Chapter 13 bankruptcy relief, you must have a regular source of income, either through employment or the operation of a business, that income must cover the cost of a court approved repayment plan. Keep in mind that you may be denied if your secured or unsecured debt limit exceeds a certain value. The best approach is to consult an experienced bankruptcy attorney prior to making your decision.
But Isn’t it Better to File for Chapter 7?
Although the idea of living debt-free via Chapter 7 bankruptcy relief is appealing, there are a number of reasons why your attorney may suggest that you instead pursue a Chapter 13 bankruptcy, including:
- You are ineligible for Chapter 7 bankruptcy relief;
- You wish to repay your debts;
- You want to prevent your home from going into foreclosure;
- You want to prevent your car or other vehicle from being repossessed;
- You wish to retain possession of nonexempt assets;
- You have debts that cannot be eliminated by declaring Chapter 7 bankruptcy;
- There are co-debtors involved.
If you are currently considering filing for Chapter 13 bankruptcy relief, it’s imperative that you speak with a qualified bankruptcy attorney as soon as possible. Thomas D. Berry can help you determine the best option for you and your family.