Alabama consumers could experience circumstances that generate delinquent debts. When this occurs, they could face adverse legal action from their creditors. These obstacles could lead to foreclosure or repossession. An Attorney in Bessemer AL could help these consumers prevent a major financial loss through chapter 13 bankruptcy.
Qualifying for Chapter 13 in Alabama
In the state of Alabama, all consumers who wish to file for bankruptcy must acquire an assessment from an attorney. The attorney reviews their income to determine if they qualify for chapter 13. This assessment is based on income statements from the previous six-month period. It allows the attorney to identify the consumer’s annual income based on their current earnings. To qualify, they must have an income that is higher than $44,756. Any value below this median income deems them eligible for chapter 7 only.
What to Expect During Chapter 13
During chapter 13, the consumer must follow specific guidelines related to their income. The payments set up for their chapter 13 case reflects their income minus their living expenses and monthly obligations. They must submit these payments each month or face garnishment. If they fail to comply with the guidelines for chapter 13, the judge will dismiss their case. If this occurs, they are responsible immediately for all debts included in the case.
The consumer must use all disposable income to pay debts. These debts aren’t included in the chapter 13 case. Select courts may require the consumer to present them with receipts for payment of these debts. If the consumer has an increase in income, the court may adjust their payment structure.
How an Automatic Stay Helps You
An automatic stay prevents lenders from taking legal action. This includes foreclosure and repossession. The consumer has the benefit of the automatic stay for the full duration of their bankruptcy case.
Alabama consumers who need assistance with foreclosure or repossession could file for bankruptcy. This legal action could present them with a safeguard to prevent a major financial loss. However, the consumer must provide documentation to prove that they qualify for this action. Consumers who need to discuss bankruptcy and need to hire an Attorney in Bessemer AL should contact Forstman & Cutchen today.