January 20, 2023
If you are wondering if a Chapter 13 may help your finances, you are not alone. In 2022, 2,393 Chapter 13 cases were filed in South Carolina.
Chapter 13 is a powerful tool for you to think about possibly using, if necessary, to help keep valuable property, get control over your finances, and get back on track. Here are five of the reasons South Carolinians choose Chapter 13 to improve their finances:
Reason 1: Behind on Mortgage Payments and in Danger of Foreclosure Sale
Stop the Foreclosure and Get 5 Years to Get Caught Up.
Many homeowners have been forced to grapple with the possibility of losing their home to a lender. When a homeowner is facing foreclosure, Chapter 13 Bankruptcy can provide a way to prevent the foreclosure. When a homeowner files for Chapter 13 Bankruptcy, they may receive an “automatic stay” which is a court order preventing any lender from collecting on an existing debt until a payment plan has been entered by the court. In Chapter 13 bankruptcy, you can make up the missed mortgage payments over time and keep your home.
Reason 2: Behind on Car Payments and in Danger of Repossession
Stop Repossession and Get 5 Years to Pay.
Chapter 13 bankruptcy offers a financial repayment plan that protects you from collection action during the case and discharges nearly all remaining balances at the end. Chapter 13 bankruptcy can ensure that you keep your car.
Reason 3: Owe Debts That Are Not Dischargeable in Chapter 7
Taxes, child support, or marital property settlements are not dischargeable in Chapter 7 bankruptcy. The Chapter 13 discharge eliminates some debts that cannot be discharged in Chapter 7, like recent tax penalties. In addition, Chapter 13 gives you time to repay debts that can’t be discharged, like recent taxes or back child support.
Reason 4: Previously Filed a Chapter 7 Bankruptcy
Filed Chapter 7 Less than 8 Years Ago
If someone has struggled with too much debt and has previously filed for Chapter 7 bankruptcy in the last 8 years, they will not be able to file another Chapter 7 bankruptcy. In this case, Chapter 13 is the only bankruptcy option available.
Reason 5: Too Much Income or Too Many Assets for a Chapter 7
Too much discretionary income can prevent someone from being eligible to cancel eligible unsecured debts in full in a Chapter 7. Owning property (land, cars, boats, jewelry, other personal property) that is worth more than the limits specified in South Carolina law can cause that property to possibly be sold in a Chapter 7 to try to pay back some of the eligible unsecured debts you may be eligible to cancel. Chapter 13 may let you cancel some of the eligible unsecured debts and repay the rest over time. Chapter 13 may also let you keep the valuable property you own in return for paying back a higher amount to your unsecured debts.
If you are wondering if Chapter 13 might help, call David Gaffney.