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 repayment strategy to your lenders, and it generally lasts three to 5 years. It provides to pay all or part of your debt from any future income you earn. You can use Chapter 13 to make up missed automobile payments, pay back taxes you owe, avoid a bank from foreclosing on your house, keep non-exempt home that you consider important, stop interest from gaining on your tax financial obligation, and much more. When you follow the terms of your contract to repay your debts, all your staying dis-chargeable debts would be released at the end of the repayment duration. The monetary amount assigned to financial institutions under a Chapter 13 bankruptcy must amount to the amount they would have gotten if a Chapter 7 bankruptcy had been filed. To file Chapter 13 bankruptcy, you need to have a “routine income source” and disposable earnings to use to your payments. Especially when you live in Ferndale WA or in a nearby city.

Typically, a chapter 13 bankruptcy is utilized when you wish to keep secured assets, such as a vehicle or house, where you have more equity in the secured assets that you can protect using your bankruptcy exemptions. It’s a reorganization of the financial obligations you owe your financial institutions that are not non-dischargeable financial obligations.

A Chapter 13 bankruptcy permits you to make up your past due payments over time and to reinstate your initial repayment arrangement. It might also be a better choice when you have a valuable non-exempt property that you want to keep. To keep a non-exempt property, you need to pay the creditor for the value of the property.

An exemption limitation would apply to any equity you have in the property. Equity is simply a distinction between the worth of the property and exactly what you owe on it. For example, if you have a truck valued at $10,000 with a loan of $8,500, the truck just contains equity of $1,500. When you have a property that is held by a loan, the equity you own in that residential or commercial property is covered by your exemptions. That is if you are current on your payments. Likewise, if you choose to keep making your regular payments on the loan, you can keep the property throughout and after your bankruptcy term is complete. If the equity is not covered by your exemptions, your creditor may opt to sell that property and after that disperse the money arising from the sale. In this case, you would be entitled to the value of your exemption in the sold-off possession as a money payment. Present bankruptcy laws permit a married couple filing together to each claim a full set of exemptions, indicating more residential or commercial property can be protected. All of this is common in Washington and throughout the region, and remember, the time to do something is now.

The non-dischargeable debts you can not eliminate in bankruptcy consist of financial obligations for individual injury/death brought on by DWI/DUI, back child assistance, alimony, debts related to household support, student loans, earnings tax financial obligations within the last three years as well as any other tax financial obligations, penalties for traffic tickets, criminal restitution, and any debts you forget to list in your bankruptcy documents, unless you inform the creditor of your bankruptcy case. Aside from those non-dischargeable debts, everything else consisted of in your bankruptcy case will be discharged at the end of your decided upon bankruptcy duration.