You may feel hopeless, and at the mercy of a faltering economy, but don’t despair. Relief is available, and there is no shame in using the law to protect yourself when you are buried under a pile of debt. You aren’t responsible for the economy, and you didn’t create the mortgage crisis. So use the law to protect yourself and your family.

A Second Chance

Bankruptcy laws are in place to help Americans get a second chance when they are snowed under by economic pressures. You have rights, including the right to be free from harassment by creditors. If your creditors are hounding you, you can make them pay. And if your debt has become more than you can manage, you may be able to file for bankruptcy.

In Chapter 13 bankruptcy, you propose a payment plan to your financial institutions, and it normally lasts 3 to 5 years. It provides to pay all or part of your financial obligation from any future income you earn. You can use Chapter 13 to make up missed vehicle payments, pay back taxes you owe, prevent a bank from foreclosing on your home, keep non-exempt residential or commercial property that you deem valuable, stop interest from gaining on your tax debt, and far more. When you follow the terms of your agreement to repay your debts, all of your remaining dis-chargeable financial obligations would be launched at the end of the repayment period. The financial amount assigned to financial institutions under a Chapter 13 bankruptcy should be equal to the amount they would have received if a Chapter 7 bankruptcy had been submitted. To file Chapter 13 bankruptcy, you need to have a “regular income source” and disposable earnings to use towards your payments. Especially when you live in Bellingham WA or in a nearby city.

Generally, a chapter 13 bankruptcy is utilized when you want to keep protected properties, such as a car or home, where you have more equity in the protected properties that you can secure by using your bankruptcy exemptions. It’s a reorganization of the debts you owe your creditors that are not non-dischargeable financial obligations.

A Chapter 13 bankruptcy allows you to make up your overdue payments gradually and to renew your initial repayment arrangement. It may also be a much better alternative when you have a valuable non-exempt home that you want to keep. To keep a non-exempt residential or commercial property, you should pay the financial institution for the worth of the residential or commercial property.

An exemption limit would apply to any equity you have in the home. Equity is just a distinction in between the worth of the property and exactly what you owe on it. For instance, if you have actually a truck valued at $10,000 with a loan of $8,500, the truck just includes equity of $1,500. When you have a home that is held by a loan, the equity you own in that home is covered by your exemptions. That is if you are current on your payments. Likewise, if you decide to keep making your typical payments on the loan, you can keep the residential or commercial property throughout and after your bankruptcy term is total. If the equity is not covered by your exemptions, your creditor might decide to sell that asset and after that distribute the money arising from the sale. In this case, you would be entitled to the worth of your exemption in the sold-off asset as a money payment. Current bankruptcy laws allow a couple filing together to each claim a complete set of exemptions, meaning more property can be safeguarded. All of this is common in Washington and throughout the region, and remember, the time to do something is now.

The non-dischargeable financial obligations you can not remove in bankruptcy consist of financial obligations for individual injury/death caused by DWI/DUI, back child support, alimony, financial obligations associated with household assistance, trainee loans, income tax financial obligations within the last three years along with other tax debts, penalties for traffic tickets, criminal restitution, and any financial obligations you forget to list in your bankruptcy documents, unless you notify the creditor of your bankruptcy case. Aside from those non-dischargeable financial obligations, everything else consisted of in your bankruptcy case will be discharged at the end of your decided upon bankruptcy period.