Who uses Chapter 13 Bankruptcy?
A Chapter 13 Bankruptcy is used most by people that have fallen behind in their mortgage payments or fallen behind on their car. The chapter 13 will force the mortgage company to stop the foreclosure process or the repossession of your car. With the mortgage only the arrears can be put in the in the plan on the car the whole thing is put in the plan. By doing this it allows you five years to pay back what ever you have fallen behind on. The car this spreads the loan out over a new five year plan reduce what your monthly payments will be.
Unsecured debts which in most case is Credit cards and medical bills can be put in the plan. The amount they receive is base on what is called disposable income. So they receive a percentage of the amount owed. The amount could be zero percent or up to a hundred percent either way once you finish the plan your done paying them. The balance is discharged.
If you are behind on house, car, or any other bills you should talk to a Bankruptcy Attorney.
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