For consumers who are facing foreclosure or repossession of their property by lenders, chapter 13 bankruptcy is an effective method to allow them to maintain ownership. Through this chapter of bankruptcy, the consumer is awarded an automatic stay which prevents their lender from taking legal action against them to seize the property. In a chapter 13 case, this automatic stay could last up to five years. If you have considered filing for this type of bankruptcy, you should contact a Chapter 13 Bankruptcy Attorney today.
Filing for Chapter 13 in Maryland
To determine whether or not you are eligible for a chapter 13, your attorney must review your finances for the last six months to conduct a means test. In this instance, you must have an income that exceeds the median income level in Maryland. The median income for the state is $69,272 currently. Although the court generally assigns a value based on the county’s median and the household size, this value is a starting point. Any consumers who fail to pass this means test are qualified to file a chapter 7 bankruptcy only. If you need to establish eligibility, you should consult a Chapter 13 Bankruptcy Attorney promptly.
After the consumer passes the means test, the next concept to establish is their expendable income and current wages. These values determine the amount of monthly payments are involved in their repayment plan submitted to the court. In this plan, their attorney must present how they will utilize their expendable income to pay off debts that are not included in their case. The attorney arrives at these values after making deductions for known financial obligations and household expenses.
Household expenses are determined by the values acquired for the sixth month period prior to filing the claim. It is advisable for consumers to file a claim after the season that presents the highest utility costs for their household. This will balance costs for them and prevent a potential hardship later on. In some cases, it could provide them with a little more cash on hand overall.
Consumers who wish to settle their debts without major hindrances could find a solution through bankruptcy. This option prevents adverse legal action by creditors and provides them with the opportunity to settle debts without fear of foreclosure.
