Bankruptcy is no longer just for corporations or individuals who are so deep in debt they’ll never be able to pay their bills. There are a number of reasons people file for federal debt relief. One of the most common reasons is to avoid foreclosure. When homeowners are unable to make their payments on the first or second mortgage, they face losing their homes. However, through Chapter 13 bankruptcy, a homeowner with an income but who is still struggling to make one or more large mortgage payments every month can get their payments reduced so they are more manageable. The first step to getting this kind of assistance is to contact a Bankruptcy Attorney St. Louis MO homeowners trust.
This type of bankruptcy is a lot different from Chapter 7. Instead of erasing debts, it simply reorganizes them and ensures that the homeowner is able to afford the monthly payments. Mortgage and student loan payments may be adjusted to fit within the debtor’s budget and monthly lump-sum payments are sent directly to the trustee. A Bankruptcy Attorney St. Louis MO homeowners turn to when they are in financial trouble can explain the process and help a client determine whether this is the most appropriate step to take in their individual situation. Chapter 13 isn’t for everyone. Debtors must have an enough resources to make minimum payments.
After making on-time payments for three to five years, a person who filed bankruptcy may be able to have the unsecured debts, such as credit cards and medical bills, discharged. This means that, as a reward for managing their finances for the length of the Chapter 13 bankruptcy, they will never have to repay their debts that are not secured by property. Family debts, student loans and first mortgages cannot be discharged in bankruptcy but a Bankruptcy Attorney creditors respect, such as Van Dillen & Flood P.C. St. Louis may be able to work with creditors to modify these debts. A modified payment amount may make it easier for the client to make full payments on time so they don’t fall behind in the future. Visit Vandillenfloodlaw.com for more details.
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