Chapter 13 is one of the most popular chapters in bankruptcy laws. Under this chapter, small businesses and individuals are granted a second chance to get their financial standing in order. This is achieved by working with a bankruptcy lawyer. If you are filing for bankruptcy, there is a sizeable chance that your Houston attorney will file for chapter 13. In this article, find out what this means for you or your business.
Your ability to pay your debts will be vetted
When your ch 13 bankruptcy attorney files for bankruptcy, you are basically telling the court that you want to be declared bankrupt so that you can get legal protection from creditors. As you can imagine, the court cannot grant this status to everyone who files. A vetting process will have to be undertaken to ensure that you’re indeed bankrupt. This is done by examining your financial and tax records. Your assets and cash flow are also examined. Once done, your ability to pay is vetted.
Some debts will be discharged
If you are granted bankruptcy status under chapter 13, you will enjoy discharge of some of your debts. Discharge refers to the wavering of debt. Some of the bets that can be waivered include property damage theft, debt incurred in order to pay taxes, welfare payments, fines, etc. The discharge of these and other debts is undertaken in order to lessen your financial burdens so that you can manage to tackle the remaining debts
Some debts will be retained
There are some debts that cannot be discharged even after obtaining a bankruptcy status under chapter 13 through your Houston attorney. These include taxes, student loans, child upkeep, alimony, and fraud-related debts. Your attorney will explain to you why these debts are not dischargeable. Some of the reasons include debts relating to unlawful conduct (e.g. injury to persons), mandatory payments (e.g. tax), and unavoidable payments (e.g. child support).
The repayment period will be adjusted
Another result of a chapter 13 bankruptcy filing is that the repayment period for your pending debts will be adjusted afresh. This is done in order to give you more time to pay. As a result, the repayment duration is extended for up to a number of years. The repayment installments are then reduced to more manageable amounts. You will have to appoint a trustee who will oversee this process. Your Houston bankruptcy lawyers will also play a key role in structuring this process.
Your creditors will have to hold off
And lastly, chapter 13 bankruptcy status means that your creditors will have to hold off. This refers to all the non-dischargeable debts that will have to be repaid. Where applicable, the government, banks, lenders, suppliers and other creditors will have to adhere to the new repayment structure provided. This means that your possessions cannot be seized or auctioned. Any communication referring to the said debts will also be updated accordingly.
If you’re looking for a Houston attorney specializing in chapter 13 bankruptcy, visit http://weberlaw.com. Weber Law Firm specializes in such cases and has the right people to steer you in such matters.