My favorite Chapter to file bankruptcy, by far, is Chapter 13. When the circumstances are right, the filing of a Chapter 13 can take a seemingly hopeless situation and completely reorganizes all debts. Usually this translates to the Debtors being able to keep their house. The Debtors can spread-out the arrears and agree to dedicate their future earnings (income) to be paid each month into a “Plan” then a Trustee distributes the money each month consistent with that Plan. It all sounds rather complicated (and it actually is), however this procedure can help somebody who lost their job, or became sick or had some other expensive problem come along, to keep their house. Chapter 13 is particularly helpful if you are:
1. Behind on Mortgage
2. Behind on annual real estate taxes
CHAPTER 13 will allow you to pay-back the mortgage arrears over the life of a Plan (36-60 months) at 0% interest. Oftentimes, you only have to pay a fraction of your general unsecured debt.
JEFF