Advantages of Filing a Chapter 13

  • Flexibility; a Chapter 13 can be dismissed or converted to a Chapter 7 at any time by the debtor. You can modify a plan if income changes or you decide to give up a house or a car. You can refinance or sell a house during the plan.
  • You can strip a wholly unsecured second mortgage; or the value a car if you’ve had it more than 910 days
  • You can challenge the costs and additional charges added to the balance of your mortgage by the lender.
  • Trustees want the plan to succeed and will work with you to get it confirmed.
  • There are more debts that can be discharged including some divorce payments and damages for malicious and willful acts
    Your attorney’s fees can be spread out rather than all due before filing.
  • When married a Chapter 13 can be filed for one spouse. This is also true of a Chapter 7 but there are advantages to the 13.
  • You can avoid having to reaffirm a car in order to keep it.
  • You can solve a tax problem or DSO (domestic support obligation) over the course of the plan, up to 60 months.
  • You can stretch out your payments for a car or other secured debt over the course of the plan.
  • You will not lose non-exempt property.
  • Depending on your income (means test) a trustee can challenge a Chapter 7 filing; the trustee cant challenge a 13.

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