Chapter 13 allows the Debtor to keep assets they would have lost in a Chapter 7 by allowing them to pay the equity to their creditors (through the Chapter 13 Trustee) over the next 3-5 years.
Chapter 13 cases generally fall into the following categories:
Foreclosure/Save the House—Debtors have fallen behind in their mortgage to a degree where a foreclosure sale is imminent. Chapter 13 allows the debtors to cure the mortgage arrears over the next 3-5 years while resuming their regular montly mortgage payments.
Excess Equity in Property—Save property that would have been liquidation/sold in a Chapter 7 by paying back the excess equity over 3-5 years versus in a lump sum in a Chapter 7.
Excess Income—The debtors have a significant income and can afford to pay something back to their creditors over the next 3 years. Whatever that excess income is, after subtracting reasonable and necessary living expenses (i.e., rent/mortgage, food, utilities, insurance...) that is what is paid monthly in the Chapter 13.
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Law Office of Lynn A. Lape
5451 North Bend Road, Suite 105B
Cincinnati, OH 45247
Phone: 513.741.9738
Fax: 513.741.0158
Email: info@lynnlapelaw.com
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