The struggle to keep up with expenses in today’s environment can be stressful. For a Tennessee resident, it may appear that there is no way to pay all of the necessary bills and still have money available for essentials and maybe even a little left over for “just in case.” While the individual wants to meet his or her financial responsibilities, the reality is that this is just not possible. In those circumstances, the individual may wonder if he or she qualifies for a Chapter 13 bankruptcy.
The benefits of filing for Chapter 13 bankruptcy can be substantial. Depending upon the individual’s income, a three to five-year repayment plan may be approved by the court. During this time period, the individual makes regularly scheduled payments toward secured debt. The benefit is that these payments are based upon the individual’s available income and thus may lower the required payments. Additionally, debtors are prevented from collection attempts during this repayment period.
There are specific eligibility requirements for the Tennessee resident to be able to file for Chapter 13 bankruptcy. Specifically, the individual’s unsecured debts must be less than approximately $394,000 and his or her secured debts must be less than a little over $1,150,000. Additionally, the individual may not have filed for any form of bankruptcy during the preceding 180 days, and the individual must complete credit counseling from an approved agency.
Filing for Chapter 13 bankruptcy is a personal decision that the individual will likely want to discuss with legal counsel. The potential benefits often make it an easy choice. Perhaps, even more important is the relief that can be offered once the individual realizes that there is hope for his or her financial situation.