CHAPTER 13 BANKRUPTCY

Serving Clients Across Arkansas  

As bankruptcy attorneys, we know that Chapter 13 is commonly referred to as a “personal reorganization”. It allows the honest but unfortunate debtor, to consolidate and reorganize their debts and protects what is most important to them from being taken through repossession, foreclosure or garnishment.

There are Six (6) major reasons for filing Chapter 13.

• Avoid foreclosure on your home; 
• Avoid repossession on your car or truck;
• Pay Back Tax Debt and stopping on-going interest and penalties;
• Falling behind on your bills and needing to reorganize your debts to prevent lawsuits and garnishments (or stop them altogether);  
• Unable to file the Chapter 7 because you above exemptions, high income, Time barred from another Bankruptcy case. 
• “Divorce Debt” needed to be wiped out 

Usually, the major question when filing for Chapter 13 Bankruptcy is: “How much will my monthly payment be?”

While we wish we could waive a magic wand and quote a payment to someone, the truth is, every case is different and the factors that go into a repayment plan vary widely. This is why it is always important to talk to an Experienced Arkansas Bankruptcy Attorney, such as Team Niblock. Generally, there are Seven Factors that determine your payment in a Chapter 13 Bankruptcy Arkansas. They are as follows:

1. What Secured Property you want to keep and pay for? An Experienced Bankruptcy Attorney can help guide your decisions, but at the end of the day, what you are keeping, you will need to pay for.
2. Tax Debts. Whether you owe the Federal Government or the state, what you owe in taxes can affect what your payment is.
3. Domestic Support. Such as what you owe in past Due Child Support or Alimony, or from a Divorce Decree. 
4. What is your Plan Length? The length of your plan of repayment can be a minimum of 36 months (3 years), or as long as 60 months (5 years). Sometimes the payment can vary based on how long your plan is proposed for.
5. What, if any, Non-Exempt Property must you pay the value of?  This maybe the very reason you are doing a Chapter 13, and if you are above exemptions, the amount that has to be paid into your unsecured creditors will determine the payment. 
6. What Leased Property (RENT TO OWN) do you want to keep and pay for? While it is recommended this is paid outside the Plan, sometimes life happens, and folks fall behind. The Chapter 13 does allow you to pay your monthly payment, and catch-up what you are behind on.  
7. Whether your Means Test results show you have “disposable income” to pay towards unsecured creditors?  If yes, then you may be required to pay that disposable income into your plan to pay towards unsecured debts. 

A Chapter 13 Bankruptcy is flexible. During a case, the payment could change as your life changes. Cars break down, life happens, and new medical debt is incurred. The Chapter 13 provides you options to help address those changes while keeping Creditors off your back and out of your pockets. Talking to an Experienced Bankruptcy Attorney, that has helped over 15,000 Arkansans file for Bankruptcy Protection, can help you navigate your Chapter 13 case, while restoring your hope and peace in financial distress. 

Contact the Experienced Arkansas Bankruptcy Lawyers at Niblock & Associates today to discuss your options.