If you feel overwhelmed due to debt settlement, Chapter 13 bankruptcy GA could allow you to restructure your debts. Learn more here.
What Is Chapter 13 Bankruptcy and How Does It Work?
Chapter 13 Bankruptcy, also known as a wage earner’s plan, is a program set up to rehabilitate the debtor so they can avoid bankruptcy. In Chapter 13, you’ll be allowed to keep all your property if you pay for it under the bankruptcy terms. You usually have three to five years to repay creditors.
During this time, you’ll make one monthly payment to a trustee who distributes the money to your creditors according to a payment plan. The amount that you pay creditors and the number of monthly payments vary depending on how much income and property you have.
You must also continue making monthly payments to your creditors until you’ve paid off all of your debts or until the end of your debt repayment plan, whichever comes first.
Is a Chapter 13 Bankruptcy Worth It?
The average individual filing for bankruptcy in Georgia is filing under Chapter 13 instead of Chapter 7. This is because Chapter 7 will not allow you to keep your home, car, or other assets if they cost more than what they are worth.
In a Chapter 13 case, you will be able to pay off the mortgages and car payments you owe, which can help you get back on your feet.
Chapter 13 bankruptcy may allow you to get caught up on missed mortgage or car payments over time. You will also be able to pay back creditors in small amounts through the repayment plan so that they are less likely to take legal action against you for non-payment of debts.
One of the biggest benefits of filing for Chapter 13 is that it can stop foreclosure proceedings, creditor harassment, debt collection lawsuits, and repossessions in their tracks. You will be given the opportunity to save your property.
Retain Counsel to Determine the Details of Your Chapter 13 Bankruptcy in Georgia
You must retain a qualified attorney to help navigate the process for whatever type of bankruptcy you choose to file for.
You must have all your paperwork in place and be prepared to answer any questions from the trustee about why you are filing. If debts need to be included or excluded from your repayment plan, an attorney can ensure that they are or are not included appropriately.
It is important to remember that filing for bankruptcy can stop foreclosure and repossession actions. Still, you must make your payment plan payments on time to keep this protection. You also want to be sure that you file all necessary paperwork with the court so that creditors cannot continue collecting against you.
If you are struggling to keep up with your mortgage, car payment, or other debts, you should speak with an experienced bankruptcy attorney today to determine if Chapter 13 is the right option for you.
The Cherney Law Firm, LLC can provide you with more information on your different bankruptcy options and help you decide which is best for your situation. Contact an experienced Atlanta bankruptcy lawyer at the Cherney Bankruptcy Law Firm to handle your case.
Chapter 13 Factors
Chapter 13 cases require the debtor to have a consistent income to ensure the payment plan can be successfully implemented.
Although it doesn’t require the same income every month, it does require proof of some consistency of payment. Self-employed individuals and those working on the commission need to prove eligibility for Chapter 13.
Their unsecured debts can’t exceed $300,000, and their secured expenses shouldn’t exceed about $900,000. Otherwise, they would need to file a Chapter 7 or Chapter 11 bankruptcy. Additionally, the debtor must be a US citizen or permanent resident.
The average time of a repayment plan is about 60 months, subject to the court’s discretion. Debtors typically get lower interest rates if they pay, on average, around the minimum amount set by the court.
Preparing Chapter 13 Bankruptcy Atlanta GA
When preparing a Chapter 13 bankruptcy in Atlanta, GA, one can handle the balance owed on car payments in a Georgia bankruptcy case. Only a skilled lawyer can explain whether you should file a Chapter 13 or Chapter 7 bankruptcy.
To qualify, you must have a monthly income and an amount of debt that fits within Chapter 13 of the Atlanta bankruptcy code. If your average monthly income is higher than the median income for a Georgia family of the same size, you must accept a five-year repayment plan.
The amount of debt permissible is tied to the consumer price index, so it is constantly in flux. There are also differing guidelines concerning unsecured and secured debts.
Some debts are considered priority debts that your repayment plan must pay off before other ones are addressed. For example, past-due child support and tax bills must be taken care of before you can apply any money to other obligations. Otherwise, you can pick up the order your debts are paid off in.
How Much Does It Cost to File a Chapter 13 Bankruptcy in GA?
You may wonder, “How much does it cost to file a Chapter 13 bankruptcy in GA?”
To be eligible for Chapter 13 bankruptcy in Georgia, the individual must have a regular source of monthly income. The said income can include wages, self-employment income, social security, pension, or other regular income sources (including assistance from family members).
Of course, the Chapter 13 bankruptcy in GA must be reasonable. Plus, the client must put in a good faith effort and intend to maintain all payments. A reputable attorney will analyze your case and review the plan to negotiate with your creditors.
- Back taxes
- Car loan or repossession
- Credit card debt
- Debt relief
- Disposable income
- Medical bills
- Mortgage payments
- Motor vehicle insurance debts
- Past due mortgage payments
- Personal loans
- Personal property
- Secured debt
- Student loans
- Unsecured debt payments
- Other debt and unique circumstances
Attorney fees shouldn’t be a concern when navigating bankruptcy forms, as the issues can be very complicated.
A plan that suggests you pay 100% of a nondischargeable loan but encourages you only to pay a small percent of your other debts is considered a bad faith bankruptcy. Only a skilled lawyer can offer reputable advice and advocacy.
Chapter 13 Bankruptcy Explained
You will likely require a GA attorney to have Chapter 7 or Chapter 13 bankruptcy explained. When filing for bankruptcy, knowing the difference between the types is essential. An attorney with bankruptcy experience can explain and provide representation.
The Difference Between Chapter 7 and Chapter 13 Bankruptcy
Chapter 13 bankruptcy is different from Chapter 7. In Chapter 7 bankruptcy, the debtor usually is entirely unable to pay their bills. Therefore, a trustee whom the court appoints often sells disposable assets. Chapter 13, on the other hand, is considered a reorganization of the debts.
The Chapter 13 case is a repayment plan where the debtor will pay back a portion of their debt for 36 to 60 months. With Chapter 13, the individual files a plan for repaying their debts over time. Usually, the debts must be paid over a few years and a maximum of five.
To qualify for Chapter 7, the debtor must pass the means test. The means test compares your monthly income to the median household income in your state. If you make less than the median income for your state, you pass and can file for Chapter 7. If you make more, you must complete the means test and Chapter 7 bankruptcy forms to continue.
The means test is used to determine how much disposable income you have each month. The test starts with your household income and subtracts certain expenses that are considered necessary. The amount of disposable income you have each month is used to determine if you can file for Chapter 7 or if you must file for Chapter 13.
If you have disposable income, you may not be able to file for Chapter 7. In this case, you would need to file for Chapter 13 and create a repayment plan to repay your debts over time.
During the Chapter 13 plan, a debtor makes monthly payments to the Chapter 13 Trustee, who oversees and administers the debtor’s Chapter 13 case. Chapter 13 is appropriate for those who would like to restructure their debt while protecting certain assets like a vehicle or home.
Other factors determining how much debt a person must pay back in a Chapter 13 plan are specific to your state.
In Georgia, if you are single with no dependents or assets and your annual gross income is less than $49,404.00, you need to pay only a small amount of your unsecured debt if anything at all. The yearly gross income level increases based on a debtor’s household size.
Additionally, the person or family can always retain the majority of the non-exempt assets and receive a discharge of the remaining debts.
Automatic Stay for a Car Loan and Other Debts
With a Chapter 13 bankruptcy case, any co-debtors are provided with an automatic stay. When spouses have a joint debt, one party could file bankruptcy, giving them enough time to pay off the debt through the proposed plan.
An automatic stay is put into effect the moment you file for bankruptcy. It is a temporary legal injunction from the federal courts prohibiting your creditors from pursuing debt collection from you. Creditors will no longer be able to attempt to collect a debt from you.
This includes wage garnishments, home foreclosure, child support, credit card collections, and vehicle repossessions. It immediately gives financial relief to the debtor and provides peace of mind.
Since creditors may continue to harass you, they are legally prohibited from doing so; you may be able to take legal action. Your legal counsel will be able to advise you and represent you if you need it.
Bankruptcy Filing for Chapter 13
You may require a Chapter 13 bankruptcy plan so it doesn’t affect your inheritance. It may need credit counseling, a debtor education course, or another payment plan.
If a person meets the proper criteria, Chapter 13 is a fantastic way to restructure debt while holding on to the dearest things.
If you are experiencing financial difficulties and are considering filing for Chapter 13, call our office to schedule your free consultation. We can help you navigate this stressful and challenging legal process.
The State of Georgia has three United States Bankruptcy Court districts:
On the occasions that you cannot successfully make your payments on time, the trustee will request a dismissal of the case as a hardship case or a conversion to a Chapter 7 bankruptcy. Then, many of your non-exempt assets will be sold to cover the debts. This will be determined on a case-by-case basis in GA.
Obtaining Chapter 13 Bankruptcy Credit Counseling
Before filing for Chapter 13 bankruptcy protection in Georgia, you must take a credit counseling course. This is an online course, and it covers many topics about debt and spending.
If you have an attorney, they will provide you with a reputable online credit counseling company that they use. They will answer any questions or concerns that you may have previously.
You will also be required to take another credit counseling course after your Chapter 13; this is usually done with the same credit counseling agency you used before filing.
Your GA bankruptcy attorney will be able to provide more information and advice, as well as file the appropriate paperwork.
Appointing a Chapter 13 Bankruptcy Trustee Georgia
After filing for Chapter 13 bankruptcy, the court will assign you a trustee. It is the trustee’s job to administer your case. They will examine your proposed repayment plan to ensure it complies with all legal requirements. They will collect payments from the plan and distribute them accordingly to your creditors.
The trustee does not work for or against the debtor or creditor. They have many rights that can be exercised for or against either one. They ensure that the debtor fulfills all their obligations throughout the process and makes timely payments.
The state or any taxing bodies do not pay the trustee. The trustee is paid through your payment plan. A percentage of every payment goes to the trustee.
Attending the Georgia 341 Creditors Meeting
All debtors who have filed for a Chapter 13 bankruptcy case in Georgia will have to attend a 341 meeting. It is also sometimes referred to as a creditor’s meeting because both the trustee and the creditors can attend. They can ask you questions about your finances, assets, and submitted paperwork.
The creditor meeting is mandatory, and you must attend. Your attorney can be present but cannot answer questions on your behalf. Creditors rarely participate in these meetings but have the right to be there.
It is best to consult a local lawyer for the most current rules and regulations.
Attending the Georgia Bankruptcy Courts
If you are filing for bankruptcy in Georgia, you must file in the jurisdiction that you live in. Georgia has three bankruptcy jurisdictions: the Northern District Court, the Middle District Court, and the Southern District Court. Each one has its boundaries and serves various counties in their district.
The information on the website for each district is crucial if you file Chapter 13 without an attorney. It will explain the Chapter 13 process, as well as the paperwork that needs to be submitted and instructions on how to do so.
An attorney who is qualified to handle Georgia Chapter 13 bankruptcy in three districts is required. If you are filing Chapter 13 with an attorney, they will have all of that information and will assist you through the whole process. All of the complicated preparation and paperwork will be done on your behalf.
Understanding Chapter 13 Bankruptcy Eligibility
Many clients have questions about Chapter 13 bankruptcy eligibility. In bankruptcy court or a credit counseling course, your attorney can help you plan payments for unsecured creditors.
Several factors determine how much debt a person is required to pay back in a Chapter 13 plan. One of these factors is the amount of secured versus unsecured debt.
In a Chapter 13 plan, secured and priority debts are paid back at 100% (this consists of, but is not limited to, financed vehicles, home mortgage arrears, particular income tax debt, and domestic support obligations). Unsecured debt, however, does not always need to be paid back in full.
If a person meets the proper criteria, Chapter 13 is a fantastic way to restructure debt while holding on to the dearest things.
This can be a tough time in your life. If you are experiencing financial difficulties and are considering filing for Chapter 13, call the office of the Cherney Law Firm to schedule your free consultation.
Understanding the Law and Chapter 13 Bankruptcy Exemptions
There are a few Chapter 13 bankruptcy exemptions that your local GA bankruptcy lawyer can describe to you when you’ve filed the paperwork.
Hire a bankruptcy attorney for legal advice about your non-exempt assets, non-exempt property, and other financial affairs. They can provide services for this and a variety of future estate planning questions you may have.
They can also represent you during your confirmation hearing when you are filing for bankruptcy in Georgia and when dealing with your creditors or developing a payment plan to protect your credit score. This will secure future income with your employer and any other jobs, as many employers check credit scores to assess the reliability of their employees.
Obtaining a Chapter 13 Bankruptcy Discharge
A Chapter 13 discharge is when a debtor completes their 3 to 5-year Chapter 13 repayment plan. At this point, all of the debts in the plan are “discharged,” and the debtor no longer has to pay.
Since I am licensed to practice bankruptcy in Georgia, I have had the unique opportunity to examine consumer bankruptcy law in both jurisdictions. While each jurisdiction differs significantly in many respects, one constant remains: bankruptcy provides people with a fresh financial start.
With this in mind, a fundamental goal of the federal bankruptcy laws is to provide everyone with a fresh financial start. This goal is accomplished through a bankruptcy discharge. A debtor who files for bankruptcy can obtain a dismissal in either a Chapter 7 or Chapter 13 case.
How Much Will a Chapter 13 Bankruptcy Cost in Georgia?
There is a filing fee of $310.00. This must be paid whether you use an attorney or not. If you use Cherney Law Firm, you will only need this $310.00 upfront and your credit report. Any other fees that are agreed upon are included in your Chapter 13 repayment plan.
If you have any questions about filing for Chapter 13 in Georgia or would like to know more about how Chapter 13 can help you, feel free to call us at 770.609.2970 anytime, or you can fill out our contact form below for a free consultation.
Why You Need an Attorney for Chapter 13 Bankruptcy
Filing for bankruptcy is a complex process, but having an attorney on your side can help make it less stressful. Here are some reasons why you should consider hiring an attorney for your Chapter 13 bankruptcy case in Georgia:
- Expertise: Attorneys who specialize in bankruptcy law have the knowledge and experience to navigate through the legal system and ensure that your rights are protected.
- Proper Representation: Your attorney will represent you throughout the entire process, including at court hearings and meetings with creditors. They can also communicate with your creditors on your behalf.
- Guidance and Advice: An attorney can provide valuable guidance and advice throughout the bankruptcy process, helping you make informed decisions that will benefit your financial future.
- Preparation of Documents: Filing for Chapter 13 requires extensive paperwork and documentation. An attorney can handle all of this on your behalf, ensuring that everything is completed accurately and on time.
- Protection from Mistakes: The bankruptcy process is filled with potential pitfalls and mistakes that can negatively impact your case. An experienced attorney can help you avoid these mistakes and protect your financial interests.
Contact an Experienced Bankruptcy Attorney
You do not need an attorney to file for Chapter 13 in Georgia. However, it is a very detailed task and having an attorney offers many significant advantages. An attorney knows the Georgia bankruptcy laws because that is what they do every day.
If you decide to file bankruptcy by yourself and fill out any forms incorrectly or miss a step in the filing process, you risk the trustee requesting that your Chapter 13 be denied. An attorney will ensure that all paperwork and forms are filed correctly, and they will be able to answer any questions and provide coaching for you throughout your case.
You are allowed certain exemptions in Georgia when you file for Chapter 13 bankruptcy. Bankruptcy exemptions are put in place so you can protect some assets, such as household goods. In a Chapter 13 bankruptcy, exemptions can affect your repayment plan. This is why it is always a good idea to consult with a bankruptcy attorney about your exemptions.
Clients at Cherney Law Firm LLC can expect the highest quality legal representation alongside thoughtful counseling and attention to detail. Mr. Mathew Cherney dedicates his time to properly investigating every possible avenue of debt relief for his clients before simply stepping into bankruptcy.
Seeking to make each consumer that comes to him for legal aid as comfortable as possible, Cherney keeps his clients in the loop with every step he takes.