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Chapter 13 Bankruptcy
In Atlanta, Georgia
Chapters 13 Bankruptcy is
intended for debtors with regular income who want to pay off their debts
but are unable to do so. These financially stressed debtors propose
a plan of repayment where creditors are paid over an extended period
of time between three and five years. Creditors may be paid in whole
or in part, and at the end of the court-approved plan any remaining
debt is discharged. This type of bankruptcy is similar to Chapter 11
bankruptcy and is sometimes called "Consumer Debt Adjustment."
Contact
a Atlanta Area Bankruptcy Lawyer
Who is Eligible for
Chapter 13 Bankruptcy in Atlanta, Georgia
Any Atlanta, Georgia individual is eligible for debt relief under Chapter
13 as long as his or her unsecured debts are less than $269,250 and
secured debts are less than $807,750. A debtor may not file under Chapter
13 or any other bankruptcy chapter if during the preceding 180 days
(six months) a prior bankruptcy petition was dismissed because the debtor
failed to appear before the court or comply with the court's orders
or was voluntarily dismissed after creditors sought relief from the
bankruptcy court to recover property upon which they hold liens. A corporation
or partnership may not file under Chapter 13.
What to Expect in Your Atlanta,
Georgia Chapter 13 Bankruptcy Case
Your Chapter 13 case begins with the filing of a petition with the US
Bankruptcy Court in Atlanta, Georgia. There are also a number of other
forms and documents that need to be presented with the petition, such
as a statement of financial affairs. Your Atlanta, Georgia bankruptcy
lawyer can advise you about these items. A husband and wife may file
joint or individual petitions. Expect to pay court administration and
filing fees at this time. If you are unable to pay these fees at the
time of filing, the court may grant permission for you to pay them in
an installment plan, with the final installment due no later than 120
days after filing the petition.
Once the petition is filed,
an "automatic stay" is put into effect. This means that creditors
generally cannot initiate or continue any action against you to collect
on your debts, including lawsuits, wage garnishment, or even phone calls.
Chapter 13 also contains a special automatic stay provision that states
that after the commencement of a Chapter 13 case a creditor may not
seek to collect a consumer debt from any individual who is liable with
the debtor. Consumer debts are those incurred for consumer, as opposed
to business, needs. One very helpful application of the automatic stay
is that if an individual debtor faced with foreclosure by the mortgage
company, filing a Chapter 13 petition can prevent an immediate foreclosure.
If this takes place, the late mortgage payments are included into the
plan of repayment, to be repaid over time. There are many complexities
to preventing foreclosure by filing for Chapter 13 bankruptcy, and your
Atlanta, Georgia Bankruptcy Lawyer can assist you in ensuring everything
is taken care of properly and within the allotted time frame.
After the petition has been
processed with the court a "meeting of creditors" is scheduled.
This is a short meeting with the trustee that the debtor must attend.
Creditors have the option whether to attend the meeting or not. After
the meeting of creditors is concluded a confirmation hearing will be
held at which the bankruptcy judge will determine whether your proposed
repayment plan is feasible and meets the standards of the United States
Bankruptcy Code. Creditors will receive a 25-day notice of the hearing
and may object to the confirmation of the plan. Within thirty days of
filing the plan, you must begin making payments to the trustee even
if the court has not yet approved the plan.
If the plan is approved,
the trustee begins distribution of the funds you have paid as soon as
practical. Payments and distributions will continue for the life of
the plan, which is no shorter than three years and may be extended to
up to five years with court approval. If the plan is not approved, you
may file a modified plan or convert your case to a liquidation case
under Chapter 7. If the plan or modified plan is not accepted and the
case is dismissed, all funds paid to the trustee minus a specified amount
for costs will be returned to you. Occasionally circumstances arise
that may affect your ability to make plan payments, a creditor may object
to the plan, or you may have accidentally forgotten to list all creditors.
In these cases, the plan may be modified either before or after it is
accepted by the court. While the plan is being carried out, you may
not incur any new credit obligation without consulting the trustee.
Once the plan has been accepted
it is your responsibility as the debtor to be sure that payments are
made and the plan is successful. There are a few ways payments may be
made. You may just make monthly payments directly to the trustee, or
you may choose have your payments deducted from your paycheck. In many
cases paycheck deduction is the best option because payments are certain
to be made on time and the plan is more likely to be completed. If you
fail to make payments according to your plan, your case may be converted
to a Chapter 7 bankruptcy case or dismissed completely.
The Role of the Trustee
A trustee will be assigned to your case to serve a role similar to that
of the trustee of a Chapter 7 Bankruptcy case. The primary role of the
Chapter 13 trustee is to serve as a disbursement agent. Your trustee
will collect your monthly payments of your plan and make distributions
to your creditors.
For
more information about Chapter 13 bankruptcy, contact a Atlanta, Georgia
bankruptcy lawyer.
