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Can my finances improve by filing for Chapter 13?

Are you experiencing a financial stutter-step? Even the most fiscally responsible Florida residents may find themselves facing some financial hard times every now and again.

The important thing is not to dwell so much on the events that led you to this point. Stuff happens. Resilient individuals learn to shake it off, examine their options and make the hard decisions they must to emerge poised to tackle their money woes head-on.

How can I turn my finances around?

As hard as it may be to admit, sometimes filing for bankruptcy remains your only viable option. Many Tampa residents can benefit from the debt reorganization that's possible from filing for Chapter 13 bankruptcy.

This is particularly true for those who earn a decent income but have managed to get deeply into debt regardless. Perhaps medical bills from an accident or protracted illness have accrued or you're on the hook for a loan you cosigned for your errant in-laws. You don't have to lose your cherished home over these debts.

Filing for Chapter 13 bankruptcy stops the foreclosure clock and allows you some breathing room to restructure your debts over a period of three to five years. This means that the debts will get paid eventually rather than be discharged entirely as they would be if you filed for a slate-clearing Chapter 7 bankruptcy.

Use Chapter 13 bankruptcy to your advantage

If you have one or two income streams, filing for Chapter 13 can allow you to retain your home even if it is encumbered by second (or even third) mortgages, as these will generally be viewed as unsecured debts. As such, these debts will have the lowest priority and may eventually be wiped out.

This works best when the initial mortgage secures the total value of your home, leaving no equity for any subsequent mortgages.

Learn more about your debt options

Interested to learn more about the ways filing for Chapter 13 can alleviate your debt? Take the steps today to become debt-free in the near future.

Source: FindLaw, "Facing Foreclosure? How Bankruptcy Can Help," accessed April 06, 2018

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