Chapter 13 Bankruptcy – What is it and how does it work?

Transcript:

Hello, my name is Jeff Kelly. I’m a bankruptcy attorney from Rome, Georgia. I’ve been practicing consumer bankruptcy for approximately 14 years. I’ve got office located. My main office is located in Rome, Georgia. I’ve got satellite offices located in Dalton, Cartersville in Dallas, Georgia as well.

What I’d like to do in this podcast is talk about chapter 13. What is it? And how could it possibly help you? Many people like to refer to chapter 13 bankruptcy as the catch your breath provision of the code is designed for people who have money to pay back their creditors but who just can’t do it all tomorrow, like the creditors are demanding when creditors are making those harassing phone calls, threatening letters, Chapter 13 stops all that 1013 gives you time to catch your breath while you while you pay your creditors. Chapter 13 can stop foreclosures, it can stop garnishments, lawsuits, and repossessions of your car. You do not need the permission of your creditors to obtain chapter 13 bankruptcy relief. Okay.

Now the first step

you need to do if you’re thinking about meeting with the bank attorneys make a list of all your debts. Every debt you have in the world, a lot of people ask, Well, can I pick this one? Can I leave this one out? Now list them all. You mean with your bank attorney? They’re on your side. Give them the full picture. Okay, the next thing you need to do is make a list of your assets. What do you own? How much is it worth? What do you owe on it? And then get as many paycheck stubs as you can because your bankruptcy attorney is going to want to go through your income and your budget and see you know what, what type of monthly payment could you afford what would work What wouldn’t work? Once they come up with the plan payment, this chapter 13 payment is going to cover all credit card debt, medical debt finance companies and car notes and IRS on your mortgage. If you have any Some cases people pay back IRS debt through chapter 13. Okay, in a chapter 13 bankruptcy plan, the credit card companies and all of the unsecured creditors are barred from collecting any interest. So this is a huge benefit of chapter 13. So, for example, let’s say you owe $10,000 in credit card debt and you’ve got an interest rate of 25%. So some are even higher. But let’s say it’s 25%. You’re going to be paying about $2,500 a year just in interest alone. But if you enter chapter 13, you’re not paying any more interest at all zero, zilch nothing on future credit card debt. A lot of people will ask, you know, am I going to end up with some type of payment plan that I just can’t afford? Well, that’s something you and your bankruptcy attorney need to determine what you can and can’t afford. That’s why it’s important to go through a budget, that you’re relying on real numbers. So that you know you don’t accidentally get put into a into a case that might be unrealistic that might not work for you.

A lot of people are hesitant to go meet with an attorney because they’re afraid it’s going to cost too much well the truth about chapter 13 and most divisions and the way it is and where I practice, the attorneys fees are included in with the chapter 13 payment so it’s very easy to do you just have to pay your filing fee and a fee for your classes you have to take beforehand and those attorneys fees are spread out over for four and a half years.

Also, most bankruptcy attorneys all over the nation will offer one free consultation. So why not take advantage of that go go meet if you know if you’re struggling with credit card debt, medical debt or being threatened with a car repossession. Don’t hesitate to meet with a bankruptcy attorney Time is of the essence. It can’t hurt for you to Explore all your options. Have a great day.