Kansas consumers facing excessive debt need a solution that doesn’t present them with a financial hardship. Among these opportunities is Chapter 13. This option could address several issues such as foreclosure and potential repossession all at once. An attorney helps consumers start a claim for Chapter 13 in Topeka, KS.
What Is an Automatic Stay?
The automatic stay prevents any legal action against the consumer by their creditors. This includes their mortgage loan lender. Under this stay, the consumer won’t face adverse legal action if they are delinquent with any debts that are included in the claim. This prevents the creditors from seizing properties, assets, or garnishing their wages. Under chapter 13, this automatic stay lasts for the full duration of the bankruptcy claim. This could equate up to five years.
Creating a Repayment Plan
Chapter 13 is a repayment plan that allows the consumer to pay one payment for all debts included. This payment plan includes all debts that were added to the bankruptcy claim. Under applicable laws, the court can discharge select debts. If this happens, the consumer is no longer responsible for the debts and doesn’t have to pay the creditors. The most common types of discharged debts are unsecured credit cards. These debts are paid off through insurance claims filed by the creditor.
What Are the Terms of Chapter 13?
The terms of a chapter 13 claim require the consumer to make timely payments to the court. If any payments are late, it could result in a discharge of the case. This will make the consumer responsible for all debts immediately.
The consumer must also attend a credit counseling program. This presents them with clear information about bankruptcy and how it affects the consumer’s credit. Under these terms, the consumer cannot open any new lines of credit.
Kansas consumers manage their debts more effectively by filing bankruptcy. These opportunities help the consumer to pay smaller payments and find a more affordable solution. They also help them repair their credit and avoid legal action from their creditors. Consumers who are interested in filing chapter 13 in Topeka, KS should visit the website today.
