Making Sure Your St. Louis Chapter 13 Plan is Feasible

When you file a St. Louis Chapter 13 bankruptcy, it is necessary to construct a repayment plan.  This plan will run from three (3) to five (5) years in length.  During this time, certain creditors are paid back.  Things like mortgage arrearage, car loans, tax debt, back child support, and sometimes a portion of your unsecured debt like credit cards, medical bills, payday loans, etc. (however it is possible to get all of your unsecured debt discharged as well).  Once all of your debts are consolidated and calculated, it is then necessary to determine how much per month is needed to pay in order to make the plan work.  This monthly payment is made to the Bankruptcy Trustee, who then disperses the funds to various creditors listed in the plan.

Making sure the plan works (i.e. that it is feasible) depends on how accurate you are when you calculate your debts.  So if for instance you believe you are behind on your mortgage by four months, you can roughly calculate how much you would owe in order to come current by multiplying the amount you pay each month on your house note by four (ex. a house payment of $1,000 per month, and you are four (4) months in arrears; this would roughly amount to $4,000 owed in order to come current; 1000 X 4 = 4000).  A Chapter 13 repayment plan is then constructed by a St. Louis bankruptcy attorney in which you are to pay back this amount over the next several years. 

But what if you were incorrect about the number of months you are behind on the mortgage?  This type of miscalculation can have an impact on whether or not the plan pays out enough to make good on the debt.  So if it turns out you are in arrears by eight (8) months (as opposed to four), then this would likely mean that you owe closer to $8,000 to the mortgage company.  But if your original calculation calls for $4,000 to be paid, then it is quite possible your repayment plan will be deemed unfeasible (in other words, the monthly payment that was calculated to pay back $4,000 will not be sufficient to pay back an $8,000 debt). 

Fortunately, there are ways to fix this kind of predicament.  The affordable St. Louis bankruptcy lawyers at Brinkman & Alter, LLC have been providing expert bankruptcy legal services for years.  Our goal is to get you on the road to financial freedom, and make sure you get the fresh start / clean slate you deserve.    

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