Reasons to file for Chapter 13 Bankruptcy

Reasons to file for Chapter 13 Bankruptcy

ď śBankruptcy is a difficult state to be in.

Apart from having difficulty in paying off financial obligations, creditors would come hounding the debtor and some would even go as far as threatening until the debt is paid. ď śWhen all possibilities have been exhausted, filing for bankruptcy may be the only solution. There are several forms of bankruptcy which one can choose from and one of them is Chapter 13 Bankruptcy.

ď śBefore filing for Chapter 13 Bankruptcy, one must do it for the right reasons.

There are a variety of reasons for going bankrupt but to qualify for Chapter 13 Bankruptcy, the following reasons are considered:

ď śProblems in paying off secured loans. ď śSecured loans are those that have properties pledged as collateral. Assets such as car, house or land title may serve as collateral. If these properties are in danger of repossession or foreclosure, filing for Chapter 13 Bankruptcy may be considered.

ď śHaving a co-debtor in a personal loan ď śWhen a debtor is unable to pay his financial obligation, the creditors would run after his co-debtor. To relieve the co-debtor of such liability, the creditors cannot demand payment from the codebtor.

ď śYou have a non-exempt property. ď śA property is considered to be nonexempt when he has to give them up to have a debt paid. If the debtor wants to keep a non-exempt property, he can file for Chapter 13 Bankruptcy.

ď śYou need more time to pay off creditors. ď śFiling for Chapter 13 Bankruptcy does not mean avoiding paying the creditors.

What you will need is to buy yourself some time by following a repayment plan which is feasible enough for you to pay them off.

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