Bankruptcy Attorney | Weik Law Office | Serving Raleigh, Durham, Cary, Chapel Hill, and Wake Forest, NC

Most unsecured debt can be eliminated through a Chapter 7, with the exception of several things, the most common as follows:

• Student loans
• Certain back taxes
• Child support, maintenance or alimony
• Court fines and criminal restitution
• Accident claims where there was a determination of intoxication
• Debt incurred by the willful or malicious injury to another

If you have secured debt, such as a mortgage or a car payment, you can continue to make the scheduled payments or you can choose to return the property and wipe out the debt.

Chapter 13 Bankruptcy
Chapter 13 is often referred to as a “wage earner plan”. If you are receiving a monthly income, you may be able to qualify to consolidate your debt into one low monthly payment that you can afford. Monthly income can be in the form of:

• Wages from your job
• Unemployment
• Disability
• Government aide
• Spouse’s wages

You may be able to qualify to pay only pennies on the dollar to your unsecured creditors, such as credit card bill, hospital bills and unsecured loans, and eliminate all interest and penalties. That means that you will be able to pay off all of your unsecured debt in 3 to 5 years.

Chapter 13 also allows you to reduce the monthly payment on some of your secured debt, such as a car payment, appliance purchases, furniture purchases and jewelry by extending the period of time that remains on your loan. It often reduces the amount of the payoff and decreases the interest rate that you are paying to your secured creditor. Once you file for a Chapter 13, it stops repossession and forbids a creditor to take any of your property.

A Chapter 13 allows you to consolidate the arrearage on your mortgage and while you are paying the arrearage, there is usually no interest that accrues. Best of all, it stops the foreclosure process.

It’s a powerful law that can help you get back on your feet!!

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