An all-too-common situation we see our clients and potential clients struggling to keep up with a mortgage payment or car payment. Many times, an unexpected event has caused this issue, and, many more times, lenders are unwilling to offer any assistance. In some situations, foreclosure or repossession are only a short time away.
One of the most powerful affects of a chapter 13 bankruptcy is the ability to not only stop the foreclosure or repossession upon filing, but resolve the issue by making up the past-due payments over an extended period of time based on the client’s finances, not the bank’s agenda. Most of the time, this gives our clients the help they need to stay in their home or keep their vehicle. As long as the chapter 13 plan is submitted in good faith, the plan is feasible (we are proposing enough funds over time to pay at least the secured and special debts), and the court otherwise confirms the plan, the creditors must accept the plan and payments. Also, the plan can reduce, sometimes substantially, the interest rate on some secured loans, such as car payments, and sometimes even “cram down” the amount owed to the value of the collateral, not the amount of the loan.
If you or a loved one are facing a foreclosure or repossession, contact Peace Law today to confidentially discuss if chapter 13 is the right solution for you. We will look at your holistic situation and discuss all options available to you.