Chapter 13 Bankruptcy - Plan of Repayment
A Chapter 13 bankruptcy, also known as a "wage earner’s" bankruptcy, gives a person, called a debtor, the ability to stop a foreclosure action (at any stage of the proceedings) on a defaulted mortgage; stop collection proceedings (like lawsuits and harassing phone calls) or even stop sheriff sales, to propose a Chapter 13 plan of repayment to cure defaults on mortgages or other secured debts, like auto loans. The Chapter 13 bankruptcy is called a "wage earner's" bankruptcy because a debtor must have regular income but the source does not necessarily have to come from employment.
BE ADVISED THAT this is a complicated process that is very difficult to do without a competent attorney.
Immediately upon filing a Chapter 13 bankruptcy, the Automatic Stay imposed by the law requires that all foreclosure actions, collection proceedings (including lawsuits and even phone calls from collection agencies) or sheriff sales, be stopped. The debtor, upon filing the bankruptcy, submits a plan to pay the arrears on the defaulted mortgage over the life of the plan whicn can be from 36 to 60 months. The payments are made to the Chapter 13 Trustee, who is appointed to administer the debtor’s case. Once the plan is confirmed (approved) by the Bankruptcy Court, the trustee sends the payments to the debtor’s creditors to cure arrears on certain debts and continues receiving payments from the debtor for the life of the Chapter 13 plan. Once the plan is completed the debtor receives a discharge of all dischargeable debts.
For more information about filing a Chapter 13 Bankruptcy, click on "Chat Now" to have your questions answered by Philadelphia bankruptcy attorney Demetrius Parrish, now or click email to send an email or call the office at 215 - 735 - 3377