All the Questions to Help You Know If You Need Chapter 13

If you’re struggling with debts you can’t pay, you may wonder whether bankruptcy is a good option for your situation. Perhaps you’re asking, “Do I need a Chapter 13 bankruptcy? And if so, what would it mean for me?”

Here’s what you need to know.

Understanding Chapter 13 Bankruptcy

There are two different types of bankruptcy: Chapter 7 and Chapter 13. In Chapter 13, you work with the courts to develop a payment plan based entirely off of your personal financial situation.

Through this plan, we consolidate all of your debts into one affordable monthly payment. The court oversees the process, which means all creditor harassment has to stop. It also put an end to foreclosure, repossession, and wage garnishment.

Below are some of the questions you can ask to understand better whether Chapter 13 is right for you.

Am I Struggling with Unmanageable Debt?

No matter which bankruptcy chapter you choose, the process exists to help people who can no longer pay back their debts.

Take a look at your current debt load, including: 

  • your mortgage
  • car loan
  • credit cards
  • medical bills
  • personal loans, and
  • other unsecured debts.

If all of that debt put together is overwhelming, and you can’t see a reasonable way to get out of it, Chapter 13 might be a good option.

Am I Facing Foreclosure or Repossession?

Are you at risk of losing your home due to mortgage debt? Or are you facing car repossession? Chapter 13 can help you stop these processes before they go through. 

Because it has the power of the court behind it, Chapter 13 is one of the only ways to stop foreclosure or repossession for good. It also stops creditor harassment, wage garnishment, and helps you get rid of other debts like credit cards and medical bills.

Do I Have Regular/Steady Income?

Chapter 13 involves creating a repayment plan to pay off your debts over a set period (usually 3 to 5 years). It doesn’t require you to be rich at all, but you do have to prove you can make regular payments.

Fortunately we work with the courts on your behalf to develop a payment plan based on your unique financial situation. It’s designed to be affordable for you month by month, so you don’t get behind.

Do I Qualify for Chapter 7?

Chapter 7 bankruptcy has a lot of advantages, as does Chapter 13. If you qualify for Chapter 7 and don’t have assets you need to protect, it might be a better choice. It all depends on your personal situation.

Keep in mind, you don’t need to choose which chapter you need on your own. We can sit down with you for a free conversation to discuss which one is right for you.

Are There Alternatives to Consider?

If you decide to deal with your debt early enough, you may find you have alternative options like debt consolidation, debt management plans, or negotiation with creditors. For example, some people facing foreclosure might try a loan modification before they pursue bankruptcy.

Just keep in mind that these alternatives don’t have the power of federal law behind them. Without a contract to protect your rights, the company you negotiate with could go back on their word and leave you right where you started.

In addition, some of these alternatives come with hefty interest rates. Even loan modification can increase your interest rate and cost far more over time than bankruptcy.

Have I Consulted with a Bankruptcy Attorney?

Bankruptcy is a serious decision, and the choice to file or not can come with serious consequences. You need someone on your side who will give you their honest opinion and speak openly with you about all of your options. Someone who won’t pressure you one way or the other.

Our Memphis bankruptcy attorneys offer a low pressure, no-strings-attached free appointment. At this meeting, we sit down with you and discuss your situation and what you can expect from the bankruptcy process. We help you figure out if you qualify and which chapter of bankruptcy would be right for you, based on your situation.

To get started, contact us online today or give us a call at 901-327-2100.



The Power of Chapter 13 Bankruptcy – Get Your Free Copy Today

In addition, we offer a free report about Chapter 13 called The Power of a Chapter 13 Bankruptcy.

In this special resource created by our Chapter 13 attorneys, we guide you through how the process works and what it can do for you.

If you have any questions about Chapter 13 or want to understand whether it might apply to your situation, get your free copy today.