Birmingham Chapter 13 Bankruptcy
Chapter 13 bankruptcy is also called the wage earner's bankruptcy because you must have a stable source of income to pay back creditors through a three- or five-year repayment plan. Deciding on the type of bankruptcy that best suits your situation is an important decision. Attorney S. Scott Allums help his clients to assess their finances and decide whether a Birmingham Chapter 13 resolves their issues.
Restructuring your debt
In addition to a steady income source, you must also have disposable income, which is income left over after basic living expenses are met. All of your disposable income is turned over to the trustee on a monthly basis, and the trustee in turn pays your creditors. Your disposable income must be adequate to pay your secured debt, which is debt backed by collateral such as your home, car, or boat.
Your bankruptcy plan may be able to reduce the amounts you owe on debts like credit cards, medical bills, and utility bills—debt that has no collateral to secure it, which is called unsecured debt. However, some debt cannot be discharged through bankruptcy, such as certain back taxes, child support, or student loans. Reviewing your debt with a skilled bankruptcy lawyer helps you understand what debt is discharged.
Buying time to pay back your debt
Sudden illness or job loss can result in a temporary lack of income, and catching up on payments becomes impossible. For debtors with a steady income source, filing for Chapter 13 bankruptcy in Birmingham buys them time to catch up on debt. For example, car payments can often be rescheduled and delinquent mortgage payments can be made up over a Chapter 13 three- or five-year time span.
Saving your assets
When you spend years acquiring assets, losing those possessions is not an attractive option. Chapter 13 bankruptcy in Birmingham gives you the opportunity to consolidate your debt, make monthly payments, and keep your assets.
Discuss filing for Chapter 13 in Birmingham
Attorney S. Scott Allums offers a free consultation to discuss your financial situation, your eligibility to file under Chapter 13, and whether filing for Chapter 13 bankruptcy is the best solution. Contact S. Scott Allums, P.C. online or call 877-770-6288 today.
