Birmingham Chapter 13 Bankruptcy FAQ

Attorney S. Scott Allums can answer your questions about Chapter 13 bankruptcy. Here are some frequently asked questions:

• How does a Birmingham Chapter 13 bankruptcy benefit you?
• What are the Chapter 13 eligibility requirements?
• How does Chapter 13 in Birmingham work?
• Can you convert a Chapter 13 bankruptcy to a Chapter 7 bankruptcy?
• How long does the repayment period last?

Discuss Chapter 13 bankruptcy in Birmingham

Contact S. Scott Allums, P.C. online or call 877-770-6288 to find out if Chapter 13 bankruptcy is right for you.

How does a Birmingham Chapter 13 bankruptcy benefit you?

For most people, the greatest benefit of filing for bankruptcy under Chapter 13 is saving their home because the bankruptcy filing triggers an automatic stay that prevents a creditor from foreclosing. You avoid car repossession, and unsecured debts are often reduced. You are no longer subject to harassing phone calls, demand letters, or collection lawsuits from creditors. Co-signers on secured property may be protected. All debts are consolidated and you make one monthly payment to the trustee, who pays your creditors for you.

What are the Chapter 13 eligibility requirements?

These are the requirements for Chapter 13 bankruptcy:

• You must have no prior bankruptcy filing and dismissal during the 180 days before filing your bankruptcy petition.
• You must complete credit counseling from an approved credit counseling agency.
• You are an individual or self-employed individual operating an unincorporated business.
• Your unsecured debts must be less than $360,475.
• Your secured debts must be less than $1,081,400.
• You must have filed all of your income taxes which were required to be filed in the last 4 years.

How does Chapter 13 in Birmingham work?

Your lawyer files a petition, all necessary documentation, and the filing fee on your behalf with the U.S. Bankruptcy Court for the Northern District of Alabama. A trustee is assigned to your case, and the filing automatically stays most creditor collection actions. The trustee schedules a creditor meeting between 20 and 50 days after the petition is filed, which you and your attorney attend for the purpose of answering questions about your finances.

The judge then schedules a hearing for the repayment plan and you, your lawyer, and creditors attend the hearing to confirm the repayment plan. You make all payments to the trustee as per the established repayment plan. You receive a discharge once all payments are made, you complete the required financial management course, and the court determines at a final hearing that all payments have been made.

Can you convert a Chapter 13 bankruptcy to a Chapter 7 bankruptcy?

Some clients may be eligible to convert a case from a chapter 13 to chapter 7 if a change in circumstances occurs.

How long does the repayment period last?

Your repayment period is either three years or five years depending on your financial situation.