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Chapter 13 Bankruptcy Archives

Modification of a Chapter 13 plan

A ruling made by the U.S. Bankruptcy Court for the Western District of Arkansas may have an impact on Ohio debtors. It held that a couple could modify their Chapter 13 plan by returning their vehicle to the lender and treating a deficiency as an unsecured claim. While bankruptcy law does permit changes to an existing plan, some observers believed that it took a major change in circumstances to allow one.

Good reasons to pay down credit card debt

Ohio residents who have high credit card debt may be causing numerous financial problems for themselves. Perhaps the most obvious impact is that payments can take money away from an emergency fund or retirement savings account. On average, an American household has about $5,700 in credit card debt. If it takes seven years to pay off that debt at an annual interest rate of 20 percent, an individual will pay $5,000 in interest.

Collectors can pursue stale debt

A Supreme Court decision in May 2017 set a significant precedent when it comes to debt collection that Ohio residents should be aware of. The decision makes it okay for collectors to file claims in bankruptcy proceedings for debts that have passed the statute of limitations and are thus time-barred.

Rebuilding credit history after filing for Chapter 13

Filing for bankruptcy can be a difficult decision for Ohio residents, but it is sometimes the only way to stop creditor harassment, stop foreclosure, provide debt relief, and reduce interest payments. After filing for bankruptcy, many assume their credit is ruined. Though it will be noted on credit reports for seven years, there are ways to improve a credit score after filing.

Trustee not permitted to make retroactive plan change

When Ohio debtors file for Chapter 13 bankruptcy, they propose a plan to repay creditors over three or five years. The court must approve the plan. The debtor's repayments are then supervised by a bankruptcy trustee. However, in a case in Texas, a bankruptcy trustee retroactively altered the payment plans for 25 cases. In April, a judge on the U.S. Bankruptcy Court for the Southern District of Texas said the trustee did not have the authority to do so.

Unsecured creditors in bankruptcy

Ohio consumers who file for bankruptcy will see their creditors divided into three different groups. Priority creditors generally are first in line, before secured creditors and then unsecured creditors. A creditor is any person or entity that a debtor owes money to. An unsecured creditor did not require any type of collateral as a condition of approving a loan. Credit card companies are a common example of an unsecured creditor.

Study finds seniors are falling deeper into credit card debt

Households in Ohio and around the country headed by individuals over the age of 50 now owe more money to credit card companies than younger households according to data compiled by a leading think tank and the AARP. Half of the older Americans surveyed by Demos and the AARP's Public Policy Institute said that they had used credit cards to pay medical bills, and one in three told the researchers that they regularly use their cards to pay for food and other basic needs.

Unemployment benefits and bankruptcy filings

When Ohio consumers file for Chapter 13 bankruptcy, they must submit a repayment plan that has to be approved by the court. The repayment plan takes between three and five years, and it is generally based on the income of the debtor. A March bankruptcy court ruling indicates that individuals who are filing for Chapter 13 may be required to count unemployment benefits as income.

How death impacts debt

Ohio residents who pass away are likely to do so while still in debt. According to December 2016 data provided by Experian, 73 percent of consumers who died owed money to creditors. On average, an individual died with $61,554 when a mortgage balance was included. Without the mortgage balance, the average individual had $12,875 when he or she passed on.

Let's skip to the end and talk about the Chapter 13 discharge

You might consider filing a Chapter 13 bankruptcy in order to keep your house and the assets you worked hard to accumulate. Someone may have told you that, after three to five years of tightening your belt and making payments to your creditors through the court, you could walk away with all of your assets, including your house, intact. You just have to come up with a repayment plan that meets the court's approval.

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