In Washington, consumers may seek a chapter 13 bankruptcy to create a more effective plan for settling their debts. The plans last up to five years based on the requirements of the creditors and the value of the debts owed. A Cheap Bankruptcy Lawyer In Tacoma Wa can answer questions about this chapter of bankruptcy to help consumers.
What Does at Least the Value Presented in Chapter 7 Mean?
When using a chapter 13, the consumer is setting up a repayment plan to settle their debts with all creditors listed in the claim. The repayment plan must present the creditors no less than the value each creditor would have received if the consumer liquidated their assets to pay off the debts. The attorney can identify this value when he or she works with the consumer to create the repayment plan.
How Does Disposable Income Apply to These Cases?
The consumer is directed to use their disposable income to pay off debts that were not included in their bankruptcy claim. Their disposable income is any value left over after they pay their household obligations and expenses. The consumer’s income is monitored, and they must show evidence that they are fulfilling this stipulation of the repayment plan.
How Does the Automatic Stay Work?
The automatic stay takes effect once the bankruptcy claim is filed through the court. It stops creditors from contacting the consumer in any way or taking any legal action against the consumer including the placement of a lien on any property owned by the consumer. However, if the case is discharged for a failure to provide monthly payments, the automatic stay ends immediately.
When Do Consumers Start Making Payments?
The consumer is required to attend a confirmation hearing for their bankruptcy plan. Once the judge provides an approval for the bankruptcy plan, the consumer must start their payments on the date identified in the plan.
In Washington, consumers file for chapter 13 when they have more debts than assets, and the liquidation process isn’t helpful. Additionally, the court in Washington can determine that the consumer is required to file chapter 13 instead of chapter 7 based on the value of their income. Consumers who want to review these cases further contact a Cheap Bankruptcy Lawyer In Tacoma Wa right now.