The Benefits of Filing for Chapter 13 Bankruptcy: A Guide for New Jersey Residents

December 15, 2023

The Benefits of Filing for Chapter 13 Bankruptcy: A Guide for New Jersey Residents

Filing for bankruptcy can be a difficult decision, but in some cases, it can provide the relief you need to regain your financial footing. Chapter 13 bankruptcy is a type of bankruptcy that allows you to reorganize your debt and repay it over a longer period of time. In this guide, we will explain why filing for chapter 13 bankruptcy might be the right choice for you, the advantages and benefits of doing so, and how our team at Velasco Law Office can assist you with this process.

Adequate solution for you

 Filing for chapter 13 bankruptcy could be the best option for you if you have a steady income but are overwhelmed with debt. This type of bankruptcy is also known as the "wage earner’s bankruptcy". As the debtor, you can create a payment plan based on your income, which can help you become debt-free in three to five years. Chapter 13 bankruptcy provides you with a structured solution that enables you to pay down your debt and, at the same time, keep much of your property.

Protect your property


One of the major benefits of filing for chapter 13 bankruptcy is the ability to keep your property, including your home and car. Unlike chapter 7 bankruptcy, where you need to give up non-exempt property in exchange for the discharge of your debt, chapter 13 bankruptcy allows you to reorganize your debts and keep your assets. As long as you make your payments on time, you can keep your home, car, and other valuable assets.

Stop foreclosure and collection efforts


If you are behind on your mortgage payments or facing foreclosure, filing for chapter 13 bankruptcy can help you stop foreclosure proceedings and give you the time you need to catch up on your payments. In addition, chapter 13 bankruptcy puts an automatic stay on any collection efforts, including those from credit card companies, medical providers, and other creditors. This means that all legal action and collection efforts against you must stop while you are under the protection of the court.

Lower interest rates and fees


Another benefit of filing for chapter 13 bankruptcy is the possibility of reducing the interest rates on your debt. With chapter 13 bankruptcy, you can consolidate your debt into one payment plan with a significantly lower interest rate. In addition, you may be able to eliminate some of the fees and penalties that are associated with certain types of debt, such as credit card balances. This means that you can save money on your debt and ultimately pay less overall.

Assistance from Velasco Law Office


Filing for bankruptcy is a complex process, and it's essential to have an experienced team of legal professionals on your side. At Velasco Law Office, we specialize in helping New Jersey residents navigate the bankruptcy process. Our legal team can guide you through every step of the process and ensure that you receive the best outcome for your particular circumstances. We will work with you to create a payment plan that fits your current budget and enables you to become debt-free over time.

Filing for chapter 13 bankruptcy can be an excellent option for those who have steady income but are struggling with unmanageable debt. By reorganizing your debt and creating a payment plan based on your income, you can regain your financial footing and keep your valuable assets, such as your home and car. At Velasco Law Office, we understand that the bankruptcy process can be challenging and emotionally taxing, which is why we are committed to helping our clients every step of the way. If you need assistance with chapter 13 bankruptcy, contact our team today to schedule a consultation.

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