Many adults throughout the nation struggle to keep up with their debts. If you’re living with debt in Mississippi, you can utilize several strategies to resolve this problem. One of the most common ways to become debt-free is by declaring bankruptcy. With that in mind, here’s more information about Chapter 13 bankruptcy and what happens if you exit this type of plan.
What is Chapter 13 bankruptcy?
Chapter 13 bankruptcy allows people in debt to create a plan to solve this problem. With the approval of your creditors, you can begin a bankruptcy plan to pay off your debt based on your earnings. You can qualify for this plan if your unsecured debts are less than $419,725 and all of your secured debts are worth less than $1,257,850.
Obtaining an early discharge from Chapter 13 bankruptcy
If you can pay off your debt through bankruptcy in either three or five years, that’s great. With that said, certain changes might happen to your financial situation. For instance, you might have inherited or otherwise have come into money recently. If this is the case, you might be able to pay off your owed debts early.
On the other hand, there’s also the possibility that your financial situation worsens. This can happen due to the loss of a job or a similar unfortunate event. If this happens, you might need to apply for a Chapter 13 bankruptcy hardship discharge. However, this doesn’t discharge all of your debt. It also enables debt collection efforts to resume.
If you qualify for it, filing for Chapter 13 bankruptcy can be a great way to resolve debts from the past. Should you require assistance during this stressful time, it might be a good idea to work with a bankruptcy attorney.