How Chapter 13 Works
You do not have to come up with any money up front. A plan is purposed for you to reorganize and repay the back payments on your mortgage so that at the end of the plan you are current and back in good standing. You can propose a plan up to 5 years to be able to do this. For example, if you have a home that is $3,400 behind in payments, you would propose a plan that allows the regular monthly payment to be made and pay the arrears of $3,400. The amount of the plan that would pay off the $3,400 in arrears over 5 years would only be $56.66 per month.
A Chapter 13 is designed to restructure and reorganize all of your debts into one affordable monthly payment. The payment is affordable because it is based off the amount of disposable income you have. Disposable income is the income you have left over after subtracting the amount of your total take home income from the amount of your reasonable living expenses. This means people that file to save their homes also get the additional benefit of being able to reorganize the rest of their debts into an affordable payment plan. Other secured debts like a vehicle can be reorganized to be paid back under more friendly terms and unsecured debts that you cannot afford to pay back are discharged out. Chapter 13 is a fair way to pay back your creditors because creditors all get paid through an organized plan (based on what you can afford) instead of each creditor calling and trying to harass you into paying their debt in full. It is fair to you because you only back what you can actually afford.
A Chapter 13 stops foreclosure immediately. If you are going through the foreclosure process, it is wise to file the Chapter 13 as soon as possible. Filing the Chapter 13 not only stops the foreclosure proceedings, it also stops the mortgage company from running up additional legal fees or costs that you are ultimately required to pay back.
Filing Bankruptcy Puts the Law On Your Side
When mortgage payments cannot be paid, legal action almost always occurs one way or the other. Foreclosure is usually the legal action that happens. By filing a bankruptcy action, you file a legal action that puts the law on your side and allows you to keep your home. It also allows you to take control of your finances so you can prevent this from happening again.
When your house is on the line you need an experienced bankruptcy attorney. Mr. Harris has helped Arkansans stop foreclosure for over 20 years. We can help you take steps to protect your home and keep it out of foreclosure. Contact us at the Harris Law Firm. Call us at 501-372-6985 or set an appointment online. We offer free consultation. There is never a fee unless you decide to file.
Your house is not just real estate, it’s your home. It is where you live and raise family. If you are at risk of losing your home, it is time to take action. You should contact an attorney to see what your options are so that you can make an informed decision as to what is right for you. If you are under threat of foreclosure or have an active one pending, it is not to late to save your home. Chapter 13 can stop the foreclosure process immediately. A Chapter 13 allows you reorganize the debt on your home so that you can pay the arrears over time (up to 5 years). A Chapter 13 also lets you keep all of the property you currently own.