Rochester Hills Chapter 13 Bankruptcy

Chapter 13 bankruptcy reorganizes debts and pays creditors monthly through a three or five-year payment plan.  Depending on your financial situation, you may prefer to file a Chapter 13 bankruptcy over a Chapter 7 bankruptcy.  Randall L. Shepard is an experienced bankruptcy lawyer in Rochester Hills who can review your debts and help you make an informed decision about filing for Chapter 13 bankruptcy in Rochester Hills.

How does Chapter 13 work?

To be eligible for Chapter 13 bankruptcy, you must have:

• A stable source of income to make monthly payments to creditors
• Completed the credit counseling requirement at an agency approved by the U.S. Trustee’s office
• $360,475 or less of unsecured debt (credit card debt, medical bills, personal loans, etc.)
• $1,081,400 or less of secured debt (mortgage, car payments, etc.)

Chapter 13 bankruptcy can benefit people with substantial income and assets.  Under Chapter 13, certain debts called priority debts must be paid in full.  Child support, spousal support, employee wages, and certain taxes are priority debts.  To retain your assets, you must make current and past-due payments on secured debts such as your car and house mortgage payments.

Once these payments are made, you apply any income left over (called disposable income) toward unsecured debts.  You are not required to fully pay off unsecured debts under Chapter 13.  In many cases, the interest rates on debts are reduced or eliminated, and some cases require no payments on unsecured debts.

Having your repayment plan approved by the court is the most important aspect of a Rochester Hills Chapter 13 bankruptcy.  Whether creditors agree with the payment plan is not as important as having the court approve your plan.

Length of the repayment plan

Whether your repayment plan extends for three years or five years depends on how your income compares with the Michigan median income.  Generally, if your income is greater than the Michigan median income, your plan is for three years; if it is less, your plan is for five years.

Experienced legal guidance can make a difference

At the law office of Randall L. Shepard, we look forward to answering your questions, explaining the details of how bankruptcy applies to your situation, and helping you decide whether Chapter 13 bankruptcy is an appropriate debt solution.

Discuss a Chapter 13 bankruptcy in Rochester Hills

Call 248-841-8772 or use our online form and contact Randall L. Shepard today.