The ins and outs of Chapter 13 bankruptcy | The Colpitts Law Firm
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Bankruptcy May Be Your Option

The ins and outs of Chapter 13 bankruptcy

When finances get thrown off track, it's good to know such problems are usually temporary. In fact, there are typically several resources available to help people restore financial stability, including but not limited to various types of bankruptcy. If an Oklahoma resident facing financial crises has steady income coming in and hopes to retain ownership of his or her assets while paying back debt, Chapter 13 bankruptcy might be a viable means for doing so.

Chapter 13 differs from Chapter 7 in several ways. A distinct difference is that the latter typically requires liquidation of nonexempt assets. The former, on the other hand, is more of a reorganization of debts that allows the filer to propose a repayment plan, which the court must approve before it becomes effective.

The court requires a Chapter 13 bankruptcy filer to present a list of all current liabilities and assets. An income schedule and any current or expected future expenditures must also be submitted to the court. Certain types of debt, such as student loans, taxes, etc., are usually not able to be discharged through the Chapter 13 process.

If there is a current collections process underway, filing for Chapter 13 bankruptcy typically halts the process. This is an automatic stay that does not require further action on a judge's part. A clerk simply forwards notice of bankruptcy to all creditors involved. An experienced Oklahoma debt relief attorney can be very helpful in such circumstances, especially if someone struggling financially is unsure which solution best fits his or her particular situation.

Source: FindLaw, "How Chapter 13 Works", Accessed on Feb. 14, 2018

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