Saving a Home: Stop Foreclosure With Chapter 13 Bankruptcy in Ohio

March 29, 2012 (Press-News.org) Saving a Home: Stop Foreclosure With Chapter 13 Bankruptcy in Ohio

The recent recession has caused millions of Americans to fall behind on their mortgage payments and has them wondering what they can do to save the family home.

In Ohio, for example, RealtyTrac reports that one in every 583 housing units received a foreclosure notice in December 2011, with a total of 8,738 properties at some stage in the foreclosure process. This placed Ohio as the state with the sixth most foreclosures, behind only California, Florida, Michigan, Illinois and Georgia.

Chapter 13 Bankruptcy and Foreclosure

The most recent statistics from the U.S. Bankruptcy Court show that more than 14,500 Ohio residents filed for Chapter 13 bankruptcy from Sept. 2010 to Sept. 2011. Undoubtedly, a vast majority of these people sought bankruptcy protection to save their residences and remain in control of their property.

Unlike Chapter 7 bankruptcy, which requires a debtor to liquidate his or her property to repay creditors, Chapter 13 allows a debtor to retain control of his or her assets -- including his or her home -- without having to sell off any property. Obviously, this is very appealing to anyone in a stressful financial situation, but only debtors with sufficient disposable income will qualify for Chapter 13 bankruptcy.

Benefits and Qualifications for Chapter 13 Bankruptcy

The backbone of a Chapter 13 bankruptcy is a three- to five-year repayment plan that is agreed upon by the court, the debtor and his or her creditors. However, a debtor must first qualify for Chapter 13 bankruptcy before the development of a repayment plan is possible.

According to the Bankruptcy Code, to qualify for Chapter 13 a debtor may not owe more than $360,475 in secured debt and may not owe more than $1,081,400 in unsecured debt. Additionally, a debtor must possess enough disposable income so he or she can follow a three- to five-year repayment plan.

All debt-collection activities immediately stop once a debtor qualifies and files a bankruptcy petition with the court. As a result, debtors receive immediate peace of mind and tranquility knowing the phone will no longer ring over dinner or before bed.

Finally, at the end of the repayment plan period, all remaining eligible debts are discharged, and debtors are far less burdened as they continue to make their mortgage payments going forward.

Anyone facing foreclosure or contemplating bankruptcy should speak with a qualified debt relief lawyer to discuss his or her eligibility and whether bankruptcy is an appropriate remedy.

Article provided by Cope Law Offices, LLC
Visit us at http://www.copelawoffices.com