I like doing Chapter 13 petitions for our clients. You see, I think Chapter 13 is the best of all possible worlds for those who are eligible.
Unlike debt consolidation with private companies (and be careful before you hire someone–see our other blogs and videos), Chapter 13 is accomplished by Court Order. But what does that mean to you? It means that while these private companies have to ask your credit card companies and other creditors for permission to reorganize your debt that you owe to them, we don’t have to ask for your creditors’ permission. We TELL your creditors what the plan is that we put together, and as long as we meet the Court’s requirements, your plan rules.
And what are these requirements?
1. The plan must be filed in good faith. And no doubt for almost all of you, it will be.
2. The plan must be your best effort. This is something your attorney at Steidl and Steinberg will help you with. By best effort, the Court means that after your necessary expenses are taken care of (food, transportation, insurances, utilities, and the like), are you devoting a reasonable amount of money toward paying back your creditors? Yes, you will have enough money in your budget to pay for dog and cat food, for your car and house maintenance, and other expenses.
3. The Plan must be feasible. Very simply, the Court wants to make certain you can afford your payment.
4. The Plan must meet the “liquidation alternative” test. By this, the Court is ensuring that you can keep all of your property as long as you pay at least the minimum amount of money to your creditors during the Plan period that they would receive if you had to sell off all of your property (which you don’t have to do, of course). When we meet, we can go over this test as it applies to your specific situation.
So that’s why I like Chapter 13’s. Paying back creditors what you can? Check. Court Order that requires the creditor to accept your plan? Check. And affordable fees? Check on that also. Call 800-360-9392 and we can discuss your options.
Thirteen can be your lucky number!