Chapter 13 Bankruptcy Lawyer Serving Northeast Florida

Elrod & Elrod Has Been Provided Debt Relief Services in Jacksonville Since 1966

Chapter 13 bankruptcy, also known as a “reorganization bankruptcy, helps people struggling with financial hardship but who earn too much money to qualify for Chapter 7 bankruptcy. Chapter 13 bankruptcy is also available for people who own substantial equity in real estate.

A Chapter 13 bankruptcy creates a re-payment plan that allows you to pay back part of your debt over 3 to 5 years. When the repayment period is over, the remaining debt is eliminated. Certain debts, like student loans, cannot be eliminated in bankruptcy; however, your repayment obligations will be reduced and deferred during the repayment period.

Is Chapter 13 Bankruptcy Right for You?

A Chapter 13 bankruptcy stops collection efforts, foreclosure proceedings, and wage garnishments, and will allow you to keep your house, car, and other valuable assets.

Benefits of a Chapter 13 bankruptcy include:

  • Lower Car Payments. In a Chapter 13 bankruptcy you will receive a new 5-year term to pay off your car loan, with an interest rate capped at 5%. If you purchased the vehicle more than 910 days before filing for bankruptcy, your repayment amount will be calculated based on the fair market value of the vehicle.
  • Reduced Mortgage Payments. A Chapter 13 bankruptcy gives you up to 5 years to catch up on mortgage payments. You are eligible regardless of whether your house was foreclosed upon. Chapter 13 bankruptcy will stop the foreclosure process and allow you to get current on your mortgage. You may also be able to eliminate second mortgages and home equity lines of credit. Back property taxes can be rolled into the re-payment plan and paid off during the 5-year period. You qualify regardless of whether the mortgage is on your primary residence or an investment property.
  • Deferred Student Loan Payments. Student loan payment cannot be eliminated in bankruptcy. However, when you file for Chapter 13 bankruptcy your student loans are not collectible and you will make no payments on them for up to 5 years. During your repayment period, student loan collectors will receive the same percentage as your other creditors, which is often pennies on the dollar.
  • Re-structured Tax Payments. Taxes are not eliminated in a Chapter 13 bankruptcy and are given priority in the re-payment plan. However, you will have a full 5 years in which to pay them off.

Contact a Northeast Florida Bankruptcy Attorney Today

If you are struggling with financial hardship and want to know if Chapter 13 bankruptcy is right for you, contact a Jacksonville, Florida bankruptcy lawyer at Elrod & Elrod today.

Call 904-356-1282, email, or complete our online form today.

Our work includes acting as a debt relief agency helping people file for bankruptcy relief under the Bankruptcy Code.