Bankruptcy For Above-Median Income Households In Louisiana
Chapter 13 bankruptcy serves to eliminate the filer’s debts after a court-dictated repayment period. While bankruptcy does not eliminate any and all debts, it is successful at eliminating most unsecured debt like medical bills, credit card debt and more. What’s more, when it comes to Chapter 13 bankruptcy, you’re able to undergo the bankruptcy process without losing property that would be seized under Chapter 7 bankruptcy.
At The Cook Law Firm, APLC, our bankruptcy attorneys provide clients in Louisiana with the most effective representation and services throughout the bankruptcy process. In this resource, we will be providing you with a general overview of Chapter 13 bankruptcy.
How To Qualify For Chapter 13
If it’s determined that you make more than the median income in your area, then your case will move to the next step of the Chapter 13 bankruptcy means test. In this step, your reasonable monthly expenses will be subtracted from your income to determine how much you’d be able to pay towards your debts.
You should also note that if you make less than the median household income in your area, that doesn’t mean you’re ineligible for bankruptcy. Instead, it means that you’d simply qualify for a different type of bankruptcy; Chapter 7.
How Chapter 13 Works
Once you’ve qualified for Chapter 13 bankruptcy, you can begin the official process. Moving on, we’ll be providing an overview of this process but recommend reading our detailed resource on the bankruptcy process, or contacting us today to learn more details and how they pertain to you.
For starters, any bankruptcy case begins with a debt counseling session. While this may seem unnecessary, it’s done to ensure that there are no solutions outside of bankruptcy that can be used to help resolve your debt issues.
Now, after it’s been determined that bankruptcy is a logical solution for you, it’s time to get started with the legal process. This requires you to file documents with the bankruptcy court under the penalty of perjury. These documents set the foundation of your case, schedule meetings and hearings, and so much more, meaning that it’s essential for you to have them filed correctly.
Because Chapter 13 bankruptcy does not require you to forfeit nonexempt property to pay back debts, you must subscribe to a court-ordered payment plan to compensate lenders in accordance with your bankruptcy case. In essence, your repayment plan will require you to pay the entirety of your disposable income for a period between 36 months (three years) and 60 months (five years).
Additionally, as this process starts, you’ll be required to meet with your bankruptcy trustee monthly throughout the course of your bankruptcy. Your trustee oversees the process and ensures that you followed the agreed-to plan. It’s important to note that when proposing and submitting your plan, lenders have a time period where they can petition your case and when they’re able to submit claims to get paid from your case.
Once that is settled, a plan confirmation takes place to address any objections and finalize your plan, and you begin making payments as scheduled for the assigned time period. The first payment is due 30 days from the day you file.
Considering you make your payments and there are no complications, as your payment plan comes to an end, you’ll be required to participate in a financial management course to prepare you for restructuring your finances after bankruptcy. Then, the magic moment of discharge happens – any remaining debts under your bankruptcy plan are discharged and you’ve completed the process!
Why You Should Consider Chapter 13
Clearly, Chapter 13 bankruptcy isn’t for everyone because of its qualification requirements. That said, if you’re in a position where you have seemingly insurmountable debt, but you’re making more than the median household income for your area, you definitely should be considering bankruptcy.
There’s no shame in bankruptcy – in fact, it’s a system that’s in place to supply individuals and businesses with a responsible avenue to overcome debt and essentially reinvent their financial situation. Whether credit collection is a disruptive aspect of your life or you’re simply looking to work towards being debt-free, bankruptcy can help you.
While bankruptcy is an incredible system that creates an invaluable opportunity to fix your finances, it’s also a difficult and intensive legal process. From simply understanding the bankruptcy process to properly filling out and filing the necessary paperwork, to negotiating your interests in bankruptcy court, there are a lot of moving parts that need dedicated attention and experience.
That’s where The Cook Law Firm, APLC, comes in. For decades, we have been practicing bankruptcy law in Louisiana and providing people with the most reliable bankruptcy services in the state, if not the country. Not only do our expert bankruptcy attorneys have the knowledge and experience to properly execute the important tasks in the process, but they are also great, personable people who will make the process understandable and much less stressful.
If you’ve been considering bankruptcy for some time or are finding yourself wanting to learn more, we’re here to help you. Simply reach out to us with any questions you have by calling 318-703-5851, and we’ll be sure to get them answered clearly. Then, if you’re ready to move forward with the process, we’ll be there every step of the way.