Many people in Louisiana and across the U.S. are struggling to keep their heads above water financially. In such circumstances, there’s often need for immediate debt relief to avoid complete financial disaster.
When people think of debt relief, they often also automatically think of Chapter 7 bankruptcy because it seems to be the term related to the topic with which many people are familiar.
However, it’s helpful to know that this is not the only type of urgent debt assistance. There are often other options available, especially for those earning regular income.
It’s understandable you want to get back on your feet and explore any option that will help restore financial stability in your life. It’s also understandable that, if possible, you’d like to avoid having to completely liquidate all your assets to satisfy your current debts.
Chapter 13 bankruptcy is one type of debt relief people in similar situations in the past have used. Below are some of the facts and benefits associated with this type of plan:
- Those earning regular wages can repay their debts without losing all their assets.
- Typical repayment plans on this program last three to five years.
- This form of debt relief often helps avoid home foreclosure.
- Contact between debtors and creditors is not needed because trustees are appointed to make payments to creditors on debtors’ behalves.
Chapter 13 bankruptcy can also protect third parties who have acted as co-signers on others’ loans.
Are you eligible for Chapter 13 bankruptcy?
As with most financial assistance programs, there are certain eligibility requirements in order for someone to be eligible to file for Chapter 13. Some of the requirements are as follows:
- Your unsecured debts must be less than $383,175
- You may not be in a partnership or part of a corporation
- You must have received credit counseling within 180 days previous to applying for Chapter 13 (Emergency options exist)
These are some of the most basic requirements associated with Chapter 13 debt relief. Your petition would also include a list of your creditors’ names and the amounts you owe to each. Information regarding income, expenses and assets would also be required. Once you have filed this type of petition, collections against you are halted for whatever time is deemed appropriate in your situation. This prevents creditors from suing you or demanding payment in any way.
Restoring financial good standing is often challenging, and the legalities of such situations can be complex. Making informed decisions and determining which option is best for your particular needs and financial goals is often easier if consultation with an experienced Louisiana bankruptcy attorney is part of your plan.