Filing for Chapter 13 Bankruptcy in Massachusetts
If your debts have gotten out of control but you have a steady income and want to keep your assets, you might consider Chapter 13 bankruptcy. Usually referred to as a "wage earners plan," any form of steady income—pensions, royalty payments, trust fund annuities—will allow you to create a Chapter 13 repayment program, as long as the income is sufficient for you to repay most of your unsecured personal debt over a three- to five-year period.
What is Massachusetts Chapter 13 bankruptcy?
Chapter 13 bankruptcy allows you to create an interest-free repayment plan for most of your debts without putting any of your assets—e.g., your home, vacation property, motor vehicles, or boat—within reach of your creditors. With the help of a Massachusetts bankruptcy lawyer, you file an income and expenses report with the court, as well a number of other financial documents, like tax returns, student loan records, any liens on your property, and records of any alimony or child support payments. You also file a proposed repayment plan with the court, either with your bankruptcy filing or within 15 days after filing bankruptcy.
The bankruptcy court may appoint a trustee to whom you make payments at regular intervals—usually every two weeks or once a month—who will then disburse the funds to your creditors in keeping with your repayment plan. Alternatively, you may opt to make the payments directly to your creditors. Discuss the advantages and disadvantages of appointing a trustee for a Chapter 13 bankruptcy with your attorney. You will make these payments for three to five years, depending on your income and expenses.
What are the advantages of Chapter 13 bankruptcy?
You can keep all your assets. Unlike a Chapter 7 bankruptcy, in which all non-exempt assets are sold to pay off creditors, Chapter 13 bankruptcy allows you to keep your assets, as long as you keep up with monthly payments. If you have already completed payments on your home, or are just a few more mortgage payments away from outright ownership, you will not lose your house to pay off creditors. If you still have mortgage payments to make, you will continue to make them throughout the Chapter 13 repayment plan and afterwards, if necessary, paying off any arrears as part of the repayment plan.
Help filing Chapter 13 bankruptcy and drafting a repayment plan
Your proposed repayment plan must both leave you enough income to live on and repay as much of your debt as possible over the allotted repayment period. The Law Office of Marla R. Margolis, LLC can help you draft a plan that gives you as large a net monthly income as possible while still convincing the bankruptcy court that you are serious about repaying your debts.
Contact Marla Margolis today to arrange a free initial consultation about your financial circumstances and whether you should file bankruptcy—call toll-free at (888) 98-MASS-DEBT or send her an email. She helps individuals and families throughout Massachusetts escape debt and create a strong financial future.
