Although Chapter 7 is the most common choice in bankruptcy filing for individuals, it is seldom appropriate for businesses, which usually require a Chapter 11 or Chapter 13. Individuals in with an income above the Arkansas state median, which a means test shows to be capable of paying debts given enough time, will not be allowed to file Chapter 7 and will need to use Chapter 13 instead. Even if you qualify for Chapter 7, you may prefer Chapter 13 if you have assets that are not exempt, which you do not want to liquidate. Contact an experienced Little Rock, AR chapter 13 bankruptcy attorney for legal counsel.
In a Chapter 13 bankruptcy, you create a payment plan lasting from three to five years in which you will pay off a large part your debt. The most significant advantage of a Chapter 13 is that you’ll be able to keep your property–especially your home and car–which might have to be liquidated if you were to file Chapter 7. But you must have sufficient income to make regularly scheduled monthly payments that will ultimately bring you current by the end of the scheduled time. Chapter 13 is often a preferable plan in these situations:
Chapter 13 can be helpful if you can meet your debt obligations but are struggling with high interest rates and demanding payment schedules. For a Chapter 13 to work, you’ll need enough income to pay for your day to day expenses and also to keep up with the scheduled debt payments. It allows you to restructure your debt, including student loans and tax debt, by consolidating it into a monthly payment plan, supervised by the court. You’ll make the regular payments to the trustee, who will then pay the agreed upon amount to each of your creditors.
During the years when the Chapter 13 is in effect, you will not be allowed to incur additional debt without the court’s permission. While all of your debts may not be cancelled, they may be reduced. Unsecured debt left over after the end of the repayment term is discharged.
If you have a job or other steady income and own assets that you don’t want to lose, a Chapter 13 might provide the solution that will relieve your stress and anxiety your financial situation is causing and allow you to look toward a debt-free future. It has advantages and disadvantages relative to a Chapter 7, so you should carefully review your financial status with an experienced Little Rock bankruptcy lawyer.
In Arkansas, when you’re wondering how you’ll ever get out of the financial hole you’re in, there is no better choice than Dilks Law Firm in Little Rock to get the expert legal advice you need when your debt has got you down. Dilks Law Firm is devoted entirely to matters of bankruptcy and debt relief, and as a result of our highly focused practice, we have an exceptional rate of success in getting our clients out of debt in the least painful way possible and helping them on the road to financial solvency.
Contact to schedule an appointment to take advantage of a free initial consultation with an experienced and skilled bankruptcy lawyer at Dilks Law Firm today. Put an end to harassment by debt collectors, fear, anxiety, and sleepless nights. Protect your assets, your future, and your family by calling today.