How Come I Have to Pay Back Creditors If I Filed Bankruptcy?

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How Come I Have to Pay Back Creditors if I filed
Bankruptcy?
Information for Chapter 13 Debtors
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Chapter 13 vs. Chapter 7
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There are different types of bankruptcy that
consumers can file if they are in trouble with
their debts
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Chapter 7 bankruptcy allows for the discharge of
debts without a repayment plan
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Non-exempt assets are sold, money is distributed
to creditors and the remaining balance of
eligible debts is forgiven
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Chapter 13 allows debtors to keep their assets
but does not allow for all eligible debts to
immediately be wiped away
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Many Debtors Must File Chapter 13
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Change to the bankruptcy law in 2005 made it
more difficult to qualify for Chapter 7 bankruptcy
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You now have to make below a certain income
level or pass a means test
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This means that more debtors file for Chapter 13
bankruptcy instead
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If you file for chapter 13, you will have a
repayment plan and thus will need to pay back
creditors even with the bankruptcy filing
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Chapter 13 Repayment Plan
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A chapter 13 repayment plan usually lasts for
anywhere from three to five years
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Creditors who you owe money to must agree to the
repayment plan
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The bankruptcy court also must sign off on the
plan, which is administered by a trustee
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The amount you must pay back under your Chapter
13 repayment plan varies depending upon the kinds
of debts you have and the income available to you
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When are Debts Discharged?
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Chapter 13 still provides financial relief by
lowering your payment amounts to reasonable levels
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At the end of the three to five year repayment
plan, the debts that are covered by bankruptcy
are discharged
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You still end up with a clean financial slate at
the end of this period, but youve gotten to
keep your assets while having to pay back more of
your debt
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A bankruptcy lawyer can explain the impact of
chapter 13 bankruptcy on your debts
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Learn More About Filing Bankruptcy in Washington
DC, Virginia and Maryland
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www.Lee-Legal.com
Bankruptcy Lawyer in Washington, DC, Maryland and
Virginia
[phone] [phone] [phone]
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