What Happens After I File Chapter 13?

The Chapter 13 Process

Once you file a Chapter 13 bankruptcy, an automatic stay will go into effect. The automatic stay will prevent creditors from collecting their debt outside of bankruptcy.  This means that foreclosure actions stop, lawsuits filed against you will stop, tax collection will stop, sheriff sales of your home will stop - basically any kind of collection practice will be stopped by the chapter 13 bankruptcy filing.

A chapter 13 bankruptcy is a type of bankruptcy that will force creditors into some kind of payment plan. The amount of this payment and the length of the payment plan will vary from case to case, and will depend upon a number of factors: income in the household, monthly living expenses, assets owned by the filer, and type of debt that need repayment. Some types of debt, including mortgage arrears, car loan arrears, and most tax liabilities must be repaid in full during the bankruptcy case. Depending on the circumstances, some type of debt like credit...

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Chapter 7 versus Chapter 13 Bankruptcy

Bankruptcy is a legal process designed to provide relief to individuals and businesses
overwhelmed by debt. Two common types of bankruptcy filings available for individuals within
Pennsylvania are Chapter 7 and Chapter 13. While both aim to help debtors achieve a fresh
financial start, they differ significantly in terms of eligibility, procedures, and outcomes. In this
article, we will explore the key differences between Chapter 7 and Chapter 13 bankruptcy,
enabling you to gain a better understanding of each and choose the most appropriate option for
your unique circumstances.

Chapter 7 Bankruptcy:

Chapter 7 bankruptcy, often referred to as "liquidation bankruptcy"; involves the sale of a
debtor's non-exempt assets to repay creditors.

Here are the essential aspects of Chapter 7 bankruptcy:
1. Eligibility: Chapter 7 bankruptcy is available to individuals, married couples, partnerships, and
corporations. However, eligibility is subject to meeting certain criteria, primarily based on
income and...

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Saving Your Home Through Bankruptcy

#homebankruptcy Aug 15, 2023

Homeowners struggling with mortgage payments have several ways to keep their house. One
option, sometimes disregarded by struggling homeowners, is bankruptcy.

An important benefit of bankruptcy is that foreclosure proceedings are immediately stopped.
This protection from foreclosure – called an “automatic stay” — allows a homeowner extra
time to get current on mortgage payments. Once a bankruptcy is filed, the law requires that
the mortgage company stop all legal action, including foreclosure. Depending on the type of
bankruptcy filed, it can help force the mortgage company into a payment plan for the arrears,
or give you the time you need to accomplish your goals with the house.

Generally speaking, it is not possible to force creditors to alter the terms of the mortgage
through bankruptcy. However, for those borrowers who are going through bankruptcy,
mortgage lenders may be willing to negotiate a loan modification. This includes reducing
interest rates or allowing...

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