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Posts tagged "monthly payments"

When Chapter 13 bankruptcy payments are late

Texas residents who file a Chapter 13 bankruptcy sometimes wonder what would happen if they run into financial difficulties and are unable to make one of their required monthly payments on time. These payments are generally sent to a designated bankruptcy trustee who then passes the money along to the debtor's creditors, and, in these situations, payments that arrive a few days late will rarely cause many problems. However, it may be wise for debtors to find out when the bankruptcy trustee sends these payments out each month.

Cram Down on your Vehicle

In a Chapter 13 Bankruptcy, if a vehicle was last financed over 2.5 years prior to the petition then the debtor can pay the value of the vehicle rather than the amount owed.  The amount owed over what the car is worth should be discharged.

That is a tremendous advantage in most cases.  That is especially true if the debtor has "rolled negative equity" from a previous car into the note on the current vehicle.

Even if the vehicle was financed within the last 2.5 years, typically a debtor filing a Chapter 13 Bankruptcy can substantially reduce their monthly payments on their vehicle by paying it through the Chapter 13 Plan.

Mobile homes are considered vehicles most of the time.  Mobile homes and motor homes depreciate very rapidly.  

Car Repossession

If your car is about to be repossessed, or if you fall 2 payments behind on your auto then it is past time to consider filing Chapter 13 bankruptcy.  Not only will the Chapter 13 save your car from repossession, it probably will lower the monthly payments on the car.

When the Chapter 13 bankruptcy is filed, the Automatic Stay provision of the Bankruptcy Code will prevent the creditor from repossessing the vehicle.  

Although most people think that they only can discharge their unsecured debt through a Chapter 7 bankruptcy, the overwhelming majority of our clients also discharge their credit card debt through a Chapter 13 as well.

By discharging your credit card debt and medical bills, and probably reducing your monthly payment on your vehicle, you will greatly relieve yourself financially by filing a Chapter 13. 

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