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Chapter 13 Archives

How does chapter 13 bankruptcy work?

If you are like others in Oregon who are struggling with overwhelming debt, then you might have considered filing for bankruptcy. Through a chapter 13 filing, you may be able to regain control of your finances without liquidating your assets. However, at The Law Office of Kim Covington, we know that the chapter 13 bankruptcy process may be confusing for some. In this post, we will discuss how chapter 13 bankruptcy works.

Requirements for filing bankruptcy in Oregon

Just like in other states, Oregon lawmakers have set up specific requirements that must apply to filers before they can be granted any relief by the courts. These rules and procedures are in place to ensure that fraud remains low and that the courts are not overburdened by people needlessly filing for bankruptcy when other remedies may suit their situations more fully. At The Law Office of Kim Covington, our staff recommend that our clients learn these requirements before they decide whether or not to pursue filing their bankruptcy.

Are financial classes required for bankruptcy?

In Oregon, if you file for either chapter 13 or chapter 7 bankruptcy, you are required to first undergo credit counseling with an approved provider, after which you must take a debtor education course. The classes have individual purposes, both of which are aimed at helping you make proper financial choices.

Advantages of Chapter 13 bankruptcy

Depending on a person or couple’s situation, Chapter 13 bankruptcy may be a good financial decision for them to make. Instead of choosing the more common liquidation offered with Chapter 7 bankruptcy, Chapter 13 provides debtors with an opportunity to repay some or all of their debts. This has some serious advantages to other types of filings.

What you should know about the meeting of creditors

The Oregon State Bar states that after filing for Chapter 13 bankruptcy, debtors must attend a meeting of creditors to give testimony regarding their debts. This meeting, which is also known as a 341 meeting, is compulsory, and if the debtor fails to attend, the Court can dismiss his or her case as a result. A trustee is usually the one to oversee this meeting, which can last a few minutes in simple matters or many hours for complex cases. The trustee is often tasked with ensuring that procedure is followed, verifying that the testimony of the debtor is accurate, and making recommendations about the debtor’s plan to the judge.

Can you file for Chapter 13 bankruptcy?

If you need to file bankruptcy in Oregon, a Chapter 13 filing may be the right choice for you. According to the Oregon State Bar, Chapter 13 is a type of bankruptcy that you can use to repay some or all of your debts while finding protection from creditors. This is in contrast to the more commonly used Chapter 7, which liquidates all of your non-exempt assets in order to pay off creditors. While both have their advantages for certain situations, you may find Chapter 13 to be the right choice for you.

Statistics show Chapter 13 bankruptcies on the rise

In Oregon, people who are struggling with debt, wage garnishment and creditor harassment may find relief by filing for Chapter 13 bankruptcy. This helps reduce debt without requiring a person to give up assets such as a car or a home. Rather than discharging the whole debt, the income, living expenses and debts are assessed and manageable installment payments are set up over a specified amount of time. A trustee is responsible for taking the monthly payments and distributing them to debtors. If the debtor makes every payment, at the end of the payment plan, the remaining debts are typically discharged.

A trustee’s role in your chapter 13 bankruptcy

If you are filing for Chapter 13 bankruptcy, you may have learned that the court will be appointing a trustee to your case. The name of your trustee will be included in the notice you receive from the court on the meeting of creditors. At the Law Office of Kim Covington, we are aware that knowing the job duties of a trustee can help you understand more about the processes of your bankruptcy.

What can I do if I cannot make my Chapter 13 bankruptcy payments?

When you file for Chapter 13 bankruptcy in Eugene, Oregon, you pay monthly payments to a trustee, and these are applied to your debt. Although the Chapter 13 plan should give you manageable payments, the percentage of your income that goes to the trustee each month may make taking care of emergency situations difficult. Defaulting on the payments can have drastic consequences, such as dismissal of your bankruptcy, so it is essential that you address the issue with your trustee before you fall behind.

Should you and your spouse file for Ch. 13 bankruptcy jointly?

In Oregon, it may not be in a married couple’s best interests to file for bankruptcy jointly. If you and your spouse are struggling with debt that is primarily in your spouse’s name, it may benefit both of you for your spouse to file for Chapter 13 individually. This is because Oregon is a common law state, which means that property acquired during the marriage is considered legally owned by the spouse who obtained it. The debts and property in your name would not be affected by the bankruptcy.

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The Law Office of Kim Covington is a debt relief agency, and I have helped families, individuals and small businesses, file for bankruptcy relief under the U.S. Bankruptcy Code, for over 19 years.

The Law Office of Kim Covington

The Law Office of Kim Covington
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Eugene, OR 97401

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