The attorneys at Vohwinkel Law help consumers throughout Las Vegas and Henderson, Nevada find effective and manageable solutions to their financial troubles by securing an adjustment of their debts through a Chapter 13 bankruptcy.
WHAT IS CHAPTER 13 BANKRUPTCY?
Chapter 13 bankruptcy is a different type of bankruptcy that is designed to assist those individuals and businesses who have assets they do not want to be liquidated and want the opportunity to pay off their debts over time. It is often referred to as the debt reorganization bankruptcy because it allows you three to five years to pay off your debts with no interest. Chapter 13 bankruptcy requires an individual or business to have a regular income sufficient to pay back their debts and allows people whose incomes are too high to qualify for Chapter 7 to still get the protection and debt relief bankruptcy provides.
Similar to other types of bankruptcy, once the process is begun, an automatic “stay” is issued to prevent bill collectors from contacting you any further. It can also protect you from the threat of foreclosure as long as you are able to work out maintaining your mortgage payments as part of your payment plan. With the help of your bankruptcy attorney, you will need to submit a full financial statement listing all your income, assets and liabilities along with your proposed repayment plan that can be made within your budget. You will be legally obligated to make your scheduled payment to the bankruptcy trustee who will then pay a portion to each of your creditors.
To help establish whether Chapter 13 bankruptcy could be the right solution for you consider the following circumstances:
- You are not eligible for Chapter 7 due to your income or assets
- Your home is being threatened with foreclosure due to delinquent payments
- You do have a steady income but have fallen behind on your bills
- You are facing repossession of your car, truck or boat
- You are being constantly harassed by collection agencies and creditors
WHEN IS CHAPTER 13 BANKRUPTCY RIGHT FOR ME?
A Chapter 13 bankruptcy payment plan is commonly known as a “wage earner's plan.” Chapter 13 bankruptcy is most appropriate if you have a steady job or other regular source of income and can devote a portion of your disposable income to a monthly payment plan. Chapter 13 bankruptcy is also appropriate if you have large amounts of debt which is secured by collateral, such as home loans, car loans, or appliances and furnishings that you bought on credit. Chapter 13 bankruptcy allows you to keep your assets while also becoming debt-free over time. In addition to your own financial responsibility, you may want to consider whether any of these loans were co-signed by friends or family members. Chapter 13 bankruptcy can protect them from having their property attacked to satisfy your debt.
Every situation is unique. Whether you should file Chapter 13 bankruptcy or Chapter 7 bankruptcy or consider another option such as debt settlement depends upon your goals and your own particular combination of assets, liabilities, income and expenses. The first step is to sit down with an experienced bankruptcy attorney to discuss these matters. If you are in the Las Vegas or Henderson area and need to find an effective solution to unmanageable debt, contact Vohwinkel Law for a free consultation.
MORTGAGE MODIFICATION MEDIATION PROGRAM
Modifying a real estate mortgage in a Chapter 13 used to be a burdensome affair. Since the debtor and creditor are required to agree on a modification of mortgage terms, delays often meant modification went by the wayside.
But the US Bankruptcy Court for Southern District of Nevada is attempting to streamline the modification process and bring parties to the bargaining table as soon as possible. Once at the bargaining table, the Court will assign a trained mediator to persuade the parties to reach an agreement.
Streamlined procedures for the Mortgage Modification Mediation (MMM) Program include:
- The debtor has 90 days from the beginning of the case to file an application for MMM;
- If the debtor recommends a mediator, the lender has only three days to object to the mediator. If an objection is filed, the clerk will select a mediator;
- After the order for mediation is filed, the lender has seven days to remit a mediator's fee of $300;
- The debtor has seven days to submit the modification package electronically and pay a $40 fee;
- Once a mediator has been selected and has reviewed the debtor(s) documents, a preliminary mediation meeting is scheduled;
- If no agreement is reached, a final conference must be held within 30 days;
- The time from the initial filing of the MMM request to final meeting must not exceed 150 days total;
- If a mortgage modification is agreed, payments will be made through the Trustee;
- Other real estate provisions, such as catching up on a mortgage in arrears, still apply, whether or not an agreement is reached.
The streamlined process is a strong victory for homeowners, who have had their requests to modify delayed too long in the past. Now, the borrower will have a timely decision and can proceed with their bankruptcy accordingly.
Bankruptcy is a complicated process for those not familiar with the rules and procedures. Attempting to “go it alone” is a path filled with risks. Meeting with one of the qualified bankruptcy attorneys at Vohwinkel Law for a consultation is a great way to determine eligibility, your rights and responsibilities involved and how the MMM program may benefit you and your Chapter 13.
Call at 702-735-1500 or email at [email protected] to schedule an appointment for a consultation.