In Alabama, chapter 13 bankruptcy provides claimants with the opportunity to restructure how they pay off their debts. The claims enable these consumers to manage their debts through this new plan and avoid common penalties as well as possible legal action. A Chapter 13 Bankruptcy Attorney in Tallassee AL provide details about how to file a claim and all expectations for claimants.
Establishing Eligibility for Chapter 13
Consumers establish eligibility for their chapter 13 case by providing their attorney with income statements for the last six months. These income statements must show that the claimant has an income that exceeds the median income for their household size within their county. The median household income for Elmore County is $54,159, and the median for Tallapoosa County is $39,206.
What is Required Through These Claims?
The consumer starts a repayment plan that requires them to submit monthly payments directly to the court or through wage garnishment. The claimant must refrain from starting any new lines of credit throughout their case which can last up to five years. They must also use their disposable income to pay off any debts that weren’t included in their claim.
What are the Benefits of Chapter 13?
The benefits of chapter 13 bankruptcy begin with the automatic stay that prevents creditors from filing a legal claim. It also stops repossession and foreclosure throughout the full duration of the case. Additionally, the judge can discharge unsecured debts such as credit card accounts, and the consumer can’t be held responsible for these debts after the end of the claim.
What Happens if the Consumer Doesn’t Follow the Guidelines?
If the consumer fails to comply with all restrictions imposed, the court can discharge their claim. This makes the consumer immediately responsible for all debts, and creditors can start a legal claim against the consumer to collect a debt. To know more, click here.
In Alabama, chapter 13 provides a structured repayment plan for consumers to pay off their debts. The cases last between three to five years and provide an automatic stay for the full duration of the case. Consumers who need answers about these claims contact a Chapter 13 Bankruptcy Attorney in Tallassee AL through Courtney & Mann LLP today.