If you find that you are qualified for a Chapter 13 bankruptcy procedure then you are going to be entering into a payment plan to be able to handle your debts. You will be required to draft up a repayment plan that will cover the debts that you have over a 3 to 5 year period.
With a Chapter 13 bankruptcy you will find that the plan must go for at least three years. But it cannot extend beyond five years. How this is going to be determined is how much your average income is within a six-month period prior to your bankruptcy, and whether this amount is above or below the median income for the household for your particular state.
If it has been determined that the income is below the median range then your plan will fall within a 36 to 60 months long process.
One of the advantages of taking the full five year limit is that it reduces the amount of money that you have to pay out each month even though you are stretching out your bankruptcy action. If your income is above the median range then you will most likely have to be in the 60 month plan but this will depend on the specific court and state that you are filing your bankruptcy in. Consult with your Ohio Attorney on what the best option for your financial situation is.
You are going to find that in your Chapter 13 bankruptcy that there are some debtors that must be paid back in full. This means that when you are developing your plan whether it is for three years or five years you must ensure that they are going to be completely paid off.
The debts are categorized such as priority debts and these cannot be discharged in a bankruptcy. With your mortgage arrears you will have to pay back your arrears and have an ongoing mortgage payment plan throughout your bankruptcy. If you are going to surrender your house then the rules are different. Ideally you want to use the services of a qualified bankruptcy attorney to help you with the entire process of the Chapter 13 bankruptcy including developing your repayment plan.
Let us help guide you through your bankruptcy process. Contact us today for a free case evaluation.