Chapter 13 bankruptcy lawyers

Chapter 13 Bankruptcy

Chapter 13 Bankruptcy Lawyers in Kansas City, Missouri

Chapter 13 bankruptcy is primarily used to stop a foreclosure or other collection action. Chapter 13 allows you to set up a repayment plan with the Trustee to get on the debts you want to pay (like house and car loans), and debts you have to pay (like tax and child support) while still allowing you to discharge other debts (like credit cards and medical bills).

Most people do not have to pay 100% of all debts in a Chapter 13 bankruptcy. The payment plan must show a good faith effort to repay your creditors. At a minimum, it must pay any arrearages on the secured property and domestic support orders as well as pay off all outstanding tax debts. If you can afford to pay more than that minimum amount, then your unsecured creditors share the rest.

A Chapter 13 payment plan can run between 3 and 5 years. At the end of that period, any debts that have not been paid are discharged.

Hundreds of clients who choose bankruptcy as the best course of action have worked with us at Jeppson Law Office. In certain situations, our knowledgeable Chapter 13 bankruptcy attorneys in Kansas City will fight to save your house and other valuable assets, such as your automobile, and assist clients in getting back on a solid financial footing. Contact us to set up an appointment for an initial consultation.

Why do I need Chapter 13 Bankruptcy Lawyers in Kansas City?

Most of the time, declaring bankruptcy in Missouri is the same as declaring bankruptcy in another state. To provide you a fresh start, the bankruptcy procedure dissolves the contracts between you and your creditors, which are governed by federal law rather than Missouri state law.

However, the laws of Missouri have a big impact. They choose which assets you are permitted to keep in your bankruptcy case. The main advantage for you is that our knowledgeable Chapter 13 bankruptcy lawyers in Kansas City will foresee any possible problems before they occur and will make plans to address them. From bankruptcy planning to anything that may transpire during the bankruptcy process. 

Bankruptcy Planning

In bankruptcy planning, we will help you consider alternatives. Possible alternatives to bankruptcy exist for achieving financial stability. Our Chapter 13 bankruptcy lawyers in Kansas City will provide a suitable bankruptcy alternative if bankruptcy is not the best option.

At Jeppson Law, we will help you decide which type of bankruptcy to file. Chapters 7 and 13 perform distinct functions and achieve different ends. For instance, Chapter 7 can quickly eliminate a substantial amount of debt, but if you are behind on your mortgage payments, it won’t help you keep your home. We will thoroughly analyze your requirements and wants before recommending a plan of action to assist you to reach your objectives.

Bankruptcy Preparation

  • Applying the Means Test. The results of the means test determine whether you can afford the repayments in a Chapter 13 bankruptcy or if you qualify for a Chapter 7 bankruptcy. Any unique conditions you provide can be used by us.
  • Valuation of your property. Do you know how much your five-year-old TV or dining room set is worth? Our Chapter 13 bankruptcy lawyers in Kansas City will make sure that you fully disclose and fairly evaluate your assets.
  • Choosing and applying for exemptions. To keep the property in bankruptcy, each state has a unique exemption system. To safeguard as much of your assets as possible, our knowledgeable Chapter 13 bankruptcy lawyers in Kansas City know how to apply the exemption rules.
  • Determining discharge of debts. In bankruptcy, certain obligations are not eliminated (discharged). Others disappear if specific criteria are satisfied. We will explain which debts will get eliminated and which will survive your case.

During Your Bankruptcy

  • Completing the schedules and other paperwork. Under penalty of perjury, you will provide several pages of financial information on your debts, earnings, spending, assets, and most recent financial activities. Our Chapter 13 bankruptcy lawyers in Kansas City are knowledgeable in the requirements for disclosure, asset valuation, what counts as income, which costs qualify as “reasonable and necessary,” which tax returns to provide, and a variety of other topics.
  • Guiding you through the Bankruptcy Case. We’ll outline the process for you and get you ready for it, including what the bankruptcy trustee and the judge do, how to get a discharge, and what your creditors can do.
  • Providing accurate and complete testimony. Under penalty of perjury, you must certify on your bankruptcy filing that the facts are true to your knowledge. You will swear or affirm that you are telling the truth at your creditors’ meeting and every time you appear in court. We’ll be there with you to make sure your testimony is accurate and comprehensive.
  • Handling creditors who violate the automatic stay. Some debtors just don’t know when to stop pursuing payments. Our Chapter 13 bankruptcy lawyers in Kansas City can compel compliance or seek the court to hold the creditor in contempt if they break the automatic stay (the injunctive order that forbids collection efforts following the filing of the case).
  • Negotiating with your creditors. In Chapter 13 bankruptcy, we will bargain with your creditors to reduce the cost of your repayment plan by negotiating payment terms, the value of the collateral (property used to secure a debt payment), and interest rates.
  • Modifying a Chapter 13 Repayment Plan. We can assist you in requesting an early discharge due to hardship or asking the court to temporarily or permanently modify the conditions of your Chapter 13 plan if circumstances change throughout your Chapter 13 case.

Will filing Bankruptcy in Missouri erase my debts?

Chapter 13 bankruptcy lawyersNumerous debts, including credit card balances, past-due utility bills, medical expenses, personal loans, and more are discharged in bankruptcy. If you’re ready to part with the home or vehicle used to secure the loan, you may even be able to cancel your mortgage or auto payment. A “secured debt” is one created when you pledge property as security; if you default on your payments, the lender has the right to repossess the property.

However, not all debts are dischargeable. Student loans are difficult to discharge (you would need to win in separate litigation), and nondischargeable obligations, such as past-due taxes and domestic support arrearages, won’t go into bankruptcy. You should be sure that filing for bankruptcy will discharge (get rid of) enough debt for it to be worthwhile.

What is Chapter 13 Bankruptcy?

You may combine debt and settle it for pennies on the dollar through Chapter 13 bankruptcy. This sort of bankruptcy essentially enables you to dismiss some obligations, such as credit card and medical debt, while putting pressure on some of your creditors to provide you with a simplified repayment plan for other bills, including your mortgage and car loan.

Creditors and debt collectors are not allowed to bother you once the Chapter 13 bankruptcy petition has been submitted to the court.

What advantages do I get from Chapter 13 Bankruptcy

For those who are struggling with enormous debt, filing for Chapter 13 bankruptcy provides several benefits, including

Saving Your Home From Foreclosure

A homeowner who files for Chapter 13 bankruptcy may be able to prevent a foreclosure by making up past due mortgage payments gradually. While paying off the Chapter 13 payment plan, it is still necessary to make all mortgage payments on time; however, if this is done, the house may be saved.

Reschedule Secured Debts

You can extend secured debts (other than mortgages) throughout the Chapter 13 payment plan, restructure those debts, and reduce their monthly amounts by rescheduling secured debts.

Protect Co-Signers and Third-Parties

Third parties and co-signers who would often be responsible with you on consumer and credit card bills are protected by a clause included in Chapter 13 bankruptcy. This is useful in helping friends and family members stay out of debt.

What is the Process of Chapter 13 Bankruptcy?

Here is an overview of the Chapter 13 bankruptcy process from beginning to end.

Take mandatory credit counseling course

Complete a credit counseling course from a provider that has been authorized by the Department of Justice U.S. Trustee Program within 180 days before filing for Chapter 13. The session assists in determining if you make enough money to pay your creditors.

The majority of providers charge a fee for the course and offer counseling free of charge or at a discounted cost if you are unable to pay. But Chapter 13 filers seldom ever meet the requirements for the discount.

File your Chapter 13 Bankruptcy paperwork

Your bankruptcy case is initiated by the filing. The automatic stay barring collection efforts will be communicated to you, the trustee chosen to handle your case, and your creditors in a letter sent shortly after by the court clerk. The notification will outline creditor due dates as well as the date and time of the 341 meeting of creditors, which is the mandatory hearing for all filers.

When submitting your bankruptcy petition and credit counseling certificate, be prepared to pay a filing fee. To locate your local bankruptcy court, utilize the Federal Court Finder.

Attend the 341 Meeting of Creditors

You must provide the trustee with “521 documents,” including tax returns, pay stubs, bank statements, and maybe more, at least five days before the hearing. At the hearing, the trustee will verify your identity and inquire about your bankruptcy case. Creditors may attend as well, although they rarely do.

Start paying your Chapter 13 Plan Payment

Even though the court won’t have “confirmed” or “approved” your proposed Chapter 13 plan, your monthly Chapter 13 payments will start the month after you file. Your Chapter 13 bankruptcy case will often conclude on schedule, in five years, thanks to the scheduling.

The trustee will return your funds if the bankruptcy court rejects your plan. Though your car lender may credit your account, don’t anticipate receiving your car payments back.

Complete the Chapter 13 confirmation process

Your proposed Chapter 13 repayment plan will provide your creditors and the bankruptcy trustee the chance to protest. If that occurs, our skilled Chapter 13 bankruptcy lawyers in Kansas City will probably attempt to adjust things so that everyone is satisfied.

Before approving your plan, the judge must be able to positively respond to the following inquiries following consideration of any argument made at the plan confirmation hearing:

  • Is the plan feasible? For instance, does the filer have enough income to pay the monthly payment?
  • Did the debtor propose the plan in good faith? Or is the filer trying to manipulate the bankruptcy process?
  • Does the plan comply with bankruptcy law? Is the filer paying creditors the amounts required by law?

Most judges give filers several opportunities to correct a deficient plan before dismissing a Chapter 13 case.

Complete the confirmed Chapter 13 Plan

You must make all payments, be current on child support and alimony obligations, and finish a second course called the debtor’s education course before the court grants a debt discharge wiping off the remaining total of your eligible debts.

Most bankruptcy filers remain debt-free after getting the discharge, except for mortgages and student loans.

How do I know if I am eligible for Chapter 13 Bankruptcy?

Below are the criteria you need to meet for you to avail of Chapter 13 bankruptcy.

Debt limits

Chapter 13 bankruptcy has a maximum debt limit. You won’t qualify if your overall debt load is too large, but you can file a Chapter 11 bankruptcy as an individual instead.

Income requirements

You must demonstrate your ability to pay your monthly household responsibilities as well as the monthly plan payment when you file for Chapter 13 bankruptcy. If you have no income or too little money, the bankruptcy court won’t “confirm” or approve your proposed Chapter 13 plan.

Person status

Small businesses and corporations are not eligible for a Chapter 13 debt discharge; only individuals and sole proprietors are. The idea would, however, cover personally guaranteed business loans for small business owners who file separately.

Additionally, from a practical perspective, a company owner’s improved financial situation might indirectly help a small firm, therefore Chapter 13 would be worthwhile to pursue.

How much will I pay in a Chapter 13 Plan?

Here are the Chapter 13 payment rules. You must add together your required payments and divide the sum by 36 or 60, the number of months in your repayment plan period, to obtain a monthly payment.

Priority Debt

Child support, alimony arrears, and current tax obligations are examples of “priority claims” that your Chapter 13 plan must pay in full.

Secured Debt

Secured debt is debt that is supported by collateral, such as your home or vehicle. To maintain the property, you must make all required payments and arrears on secured debt.

Unsecured Debt

These are the debts that you still owe. After paying off secured debt, priority debt, and permitted living costs, the plan must allocate your disposable income—the sum left over—toward unsecured debt, such as credit card balances and medical expenses.

Trustee Fee

The Chapter 13 trustee will get an extra ten percent from you.

What if I can’t pay my Chapter 13 plan?

It won’t always mean the end of your Chapter 13 case if your income declines throughout your repayment period, which happens more frequently than one would assume. These are your alternatives if you are unable to finish your existing Chapter 13 plan.

Modify your payment

The amount of disposable income you pay toward nonpriority unsecured obligations, such as credit card balances, medical expenses, and personal loans, might be reduced by the court. But unless you’re prepared to liquidate assets and distribute the money to your creditors to lower your liability under the “best efforts” rule, that’s it.

Ask for a Chapter 13 Hardship Discharge

You can be eligible for a hardship discharge if you lose your work as a result of a plant closing in a town with just one manufacturer or because of a serious illness. What’s wrong here? Because you must pay the sum specified by the best efforts clause, a hardship discharge is frequently not accessible until you are deep into your plan.

Consider converting or “switching” to Chapter 7 Bankruptcy

The drawback? Any non-exempt property you haven’t paid to keep will probably be forfeited. The best efforts rule is in effect once more. Your nonexempt property’s market value must be received by unsecured creditors as a minimum payment. If not, the Chapter 7 trustee will liquidate the nonexempt assets and settle the unsecured debts.

Dismiss your Chapter 13 Bankruptcy Case

Any unpaid debt amounts and the interest creditors did not charge you while your Chapter 13 case was pending will still be due.

What are the debts that survive Chapter 13 Bankruptcy?

Some obligations in a Chapter 13 bankruptcy must be fully repaid through your Chapter 13 plan. The majority of debtors pay some of their unsecured, non-priority creditors under the plan, and the remaining balance is dismissed after the bankruptcy.

When your Chapter 13 plan is finished, certain unpaid, non-priority obligations are still not erased.

Debts are not dischargeable under any circumstances

Regardless of your circumstances or income, some debts survive Chapter 13 bankruptcy.

Domestic support obligations

Child support and alimony you owe directly to an ex-spouse or child are not dischargeable in either Chapter 7 or Chapter 13 bankruptcies. These obligations must be fully repaid under your Chapter 13 repayment strategy.

During the term of your plan, you are not required to repay all of the child support you owe to a governmental collection agency; but, any balance that remains after the plan’s conclusion is not dischargeable.

Criminal penalties

You cannot use Chapter 13 to get rid of debts related to penalties or restitution orders that were part of your punishment for conviction of any crime (even traffic violations).

Fines or penalties owed to a Government Agency

This debt will not be forgiven if you have already received a fine, penalty, or seizure of property from a governmental body. However, merely the fine itself is not dischargeable if the government organization assessed the fine because you were awarded benefits as a result of your failure to submit income or for some other improper action.

You can discharge the excess payment just like any other unsecured obligation. However, the court may decide that the overpayment is not dischargeable if the agency brings a lawsuit alleging that you received the overpayment via deception.

Certain taxes

Recent income tax debts are priority debts and must be fully paid off in any Chapter 13 plan; they are debts that initially became due within the three years before your filing date.

You will either need to make the tax debt payments outside of bankruptcy or convert your Chapter 13 bankruptcy to a Chapter 7 bankruptcy if your Chapter 13 bankruptcy is terminated early for any reason.

Intoxicated driving debts

Any debt resulting from an injury caused by driving while drunk is not dischargeable if you cause someone’s death or serious harm. What happens, though, if you are sued and the judge or jury rules that you are responsible but does not expressly determine that you were drunk?

You might not benefit from this. If the bankruptcy court (or a state court in a judgment collection action) finds that you were inebriated, the judgment against you won’t be dismissed.

Debts or creditors you don’t list

To file for bankruptcy, you must mention every creditor and provide their most recent addresses on your bankruptcy paperwork. The court will be able to mail out notice of your bankruptcy with the greatest possibility of success in this manner. If despite your efforts, the formal notification is not delivered to the creditor of unavoidable circumstances.

The debt will still be forgiven (as long as it is otherwise dischargeable), for instance, if the post office makes a mistake or the creditor relocates without giving a forwarding address.

The debt will also be wiped if the creditor had additional knowledge of your bankruptcy or ought to have known about it, such as via a letter or phone call from you.

Student loans

A student loan cannot be canceled in Chapter 13 bankruptcy, as it may in Chapter 7 unless you can convince the bankruptcy court that repaying it would be extremely difficult. You might be eligible to discharge the interest on student loans (but not the principal) in certain circumstances.

Fraudulent debts

In Chapter 13, debts stemming from theft, fraud, or violation of fiduciary responsibility cannot be forgiven. The process used by bankruptcy courts to determine whether these debts are dischargeable in Chapter 13 cases is the same as it is in Chapter 7 cases. In other words, if the creditor doesn’t show up and prove fraud in the bankruptcy court, the debt will be dismissed.

Get in touch with a reputable Chapter 13 bankruptcy lawyer in Kansas City, Missouri

Our knowledgeable Chapter 13 bankruptcy lawyers in Kansas City have spent years perfecting a process that will make filing for bankruptcy as simple as possible for you. We provide unmatched assistance throughout the whole process and will assist you in choosing the best course of action for you.

Even in the most complex financial situations, we have assisted clients across the state in finding bankruptcy relief. Our sympathetic attorneys are renowned for their talent in developing original solutions that cater to the particular demands of our clients.

Look no further than the Jeppson Law Office for thorough, patient guidance. Contact our Chapter 13 bankruptcy lawyers in Kansas City right away to get the second opportunity you deserve.