If you have decided to talk to an experienced lawyer about filing for bankruptcy using Chapter 13, it’s within your best interests to ensure that you comprehend some of the rules and regulations which are associated with filing for Chapter 13. To discover how your bankruptcy decision may directly influence your decisions to take a vacation, invest in a new asset class and start your own business, simply continue reading.
Rules & Regulations Of Chapter 13
In order to meet the eligibility requirements to invoke Chapter 13, you must have not acquired over $419,275 in unsecured debt and no more than $1,275,850 in secured debt. Unsecured debt refers to debts such as credit card debt, medical debt, and personal loans. While an example of a secured debt is a mortgage on a family house. To discover more information about Chapter 13 eligibility, make sure to contact a qualified bankruptcy lawyer.
Also, keep in mind that you will need to prove that you have kept up to date with your state and federal taxes for the past four years in order to be eligible to apply for Chapter 13. So ensure to locate records of your taxes for the past four years, before you contact your lawyer to file for bankruptcy.
While most of your unsecured debts such as credit card debts will be cleared, it is likely that you will be made to pay back a small portion of each debt. Furthermore, in order to be eligible to file for a Chapter 13 bankruptcy, you’ll also need to be able to come up with a detailed plan, which will show the court how you plan to pay off a small portion of this debt, within a relatively short 3-5 period. One advantage of filing for Chapter 13 is that creditors will not be able to seize your funds, possessions, or property during this time period. Which should give you adequate time to get on top of your finances again.
If one of your primary goals, when it comes to your bankruptcy, is to retain your primary residence, you will also need to come up with a viable, detailed plan on how you’ll be able to pay off your secured debt. For example, if you have fallen behind on your mortgage repayments and are worried that your home will be marked by your bank for foreclosure, in order to pay for your debt, you’ll have to convince the court system that you’ll be able to catch up on your mortgage repayments. Again you will have a window of 3-5 years following your bankruptcy in order to catch up on your mortgage repayments.
Once you’ve listed out how you plan to pay a portion of your unsecured debts and your secured debt off in the next 3-5 years, you’ll need to appoint a trustee. Whose job it will be to make your scheduled loan repayments on your behalf, for the course of your outlined repayment plan. Do keep in mind that there are fees associated with hiring a trustee to make your scheduled loan repayments for you and that you’ll be made to pay a fixed percentage fee of all of the funds that are used to make your repayments.
Explore Your Options With An Austin Bankruptcy Attorney
Can you go on vacation during Chapter 13? The simple answer is yes. You will not be prevented from booking and enjoying a domestic or international vacation if you are able to pay for your vacation in full. In fact, you are free to take as many vacations as you would like during the 3-5 year period after you’ve filed for Chapter 13.
There are however a few stipulations that are well worth keeping in mind. As an example, you will still need to ensure that you are back in the United States to attend any bankruptcy-related meetings to which you are summoned to. Secondly, you must be able to keep paying all of your scheduled loan repayments such as your mortgage payments, if you wish to leave the country at your own discretion.
Once you’ve filed for bankruptcy it is possible to start rebuilding your investment portfolio, hopefully, you must seek court approval before you start investing in a new asset class. For example, if you want to start investing in property shares or cryptocurrencies such as Bitcoin, it’s likely that you’ll have to obtain court permission in order to start making your new investments.
Do keep in mind that just like traveling, as long as you can prove that you’ll be able to continue making your loan repayments, such as your mortgage repayments, it is extremely unlikely that the court will choose to decline your request to make an investment. As the court’s primary aim is not to control your finances but to ensure that you’ll be able to continue making your secured loan repayments.
As soon as you have filed for bankruptcy, you will have the opportunity to start a new business, despite having just filed for bankruptcy. Do keep in mind though that your bankruptcy will have a negative effect on your credit rating and that it may prove extremely difficult to get a business loan for a large sum of money approved. Instead, you may want to save the necessary capital which your business requires, in order to launch your business without incurring any extra debts that could make it more difficult to keep making your mandated mortgage repayments. In order to keep your home.
You may be pleasantly surprised by how much freedom that you’ll still have over your life if you do choose to go ahead and file for Chapter 13 with your chosen bankruptcy lawyer. As you will still be able to travel both domestically and internationally and to invest and launch a new business after you have successfully been declared bankrupt using Chapter 13.
Remember that one of the keys to being able to achieve a high degree of financial autonomy after being declared bankrupt is to ensure that you continue to make all of your planned loan repayments.
Average Monthly Payment For Chapter 13
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