6 Reasons To File For Chapter 13 Bankruptcy

When it comes to getting your debt paid off faster, you may want to consider filing for Chapter 13 bankruptcy. This type of bankruptcy can help you establish a debt repayment plan that may better fit your financial situation. Knowing some of the other reasons for you to file for a Chapter 13 bankruptcy may motivate you to begin this process.

Reason #1: Lower payments

If you current payments are too high, you may be able to lower the amount of your payment by being eligible for this bankruptcy. This is a common reason mean people may choose to file for a Chapter 13 to get more time to pay a debt and decrease monthly bills.

Reason #2: Your credit rating isn't affected

One of the advantages of choosing this type of bankruptcy is that your credit score isn't impacted in the long-term. If you choose to have your debts discharged by way of a Chapter 7 bankruptcy, this could cause your credit rating to drastically decline.

Reason #3: Legal fees spread out

Filing for this bankruptcy will allow you to have your attorney fees spread out over time. This can decrease the amount of your immediate financial burden and allow you to be less stressed about making payments for your legal services.

Reason #4: Obtain automatic stay

Do you have creditors harassing you about payment? If so, by being eligible for a Chapter 13 bankruptcy, you may be capable of avoiding this undesirable situation. The automatic stay prevents creditors from contacting you or attempting to seize your property due to late payments.

Reason #5: Stop foreclosure

If you are behind on your mortgage payments and losing your home is a risk, you may be capable of preventing a foreclosure from occurring. Reorganizing your home loan and being able to make regular payments can prevent the possibility of foreclosure and allow you to maintain ownership of your house.

Reason #6: Protect co-signers

If you enlisted the help of another individual who signed on your behalf to ensure you were capable of getting the loan, also referred to as a co-signer, this person will be protected. By establishing a repayment plan and being able to avoid not repaying the debt, you won't impact the co-signer in a negative way.

Finally, filing for a Chapter 13 bankruptcy may financially help you gain control over your money. Be sure to work with a bankruptcy attorney, such as Bauer & French Attorneys at Law, who can guide you through this process.