CHAPTER 13 IN MARYLAND USUALLY ALLOWS YOU TO REPAY ONLY A PORTION OF YOUR DEBTS, WITHOUT INTEREST AND WITHOUT BEING BOTHERED, SUED, OR GARNISHED BY YOUR CREDITORS
WHY FILE CHAPTER 13 INSTEAD OF CHAPTER 7
There can be many reasons why you would choose Maryland Chapter 13 bankruptcy instead of Maryland Chapter 7 bankruptcy. While the following circumstances might indicate filing Chapter 13 would be better than filing chapter 7, it is not always the case and you need sound, experienced legal counsel to fully explore all of your options.
YOU WOULD LIKE TO REPAY SOME OF YOUR DEBT BUT WITHOUT THE CRAZY INTEREST RATES YOU ARE BEING CHARGED
You would like to repay some of your debts and unlike debt settlement, you need the protection of the bankruptcy court so you cannot be sued while you are repaying your creditors over time. Debt settlement does not protect you from lawsuits even while you are paying back your creditors! Your interest rates have been raised to crazy levels and you feel like you have paid enough. You also may think filing Chapter 13 bankruptcy is simply the “Right Thing To Do” rather than file Chapter 7 where you don’t have to pay anything back to your unsecured creditors
YOU ARE BEHIND ON YOUR HOME OR CAR AND ARE IN DANGER OF LOSING THEM BUT YOU WANT A CHANCE TO CATCH UP YOUR PAYMENTS TO KEEP THEM.
You have gotten behind on your mortgage or car loan, and would like to catch up the payments your are behind, but need time to do so. Your intention is to continue paying the mortgage or car payments going forward but need a break in catching up the overdue payments.. You cannot do this in Chapter 7 bankruptcy but can only make up missed payments in a Chapter 13 bankruptcy.
YOU WOULD LIKE TO GET RID OF YOUR 2ND MORTGAGE
Your house is upside down in value and you owe two mortgages with your house worth less than the amount you owe on your first mortgage. In this case, you might be able to strip off your second mortgage in chapter 13, paying back only a small portion of your mortgage over five years so that after the bankruptcy is over in five years, you would only have one mortgage.
YOU OWN MORE PROPERTY THAN YOU CAN PROTECT IN A CHAPTER 7 AND RATHER THAN LOSING THE PROPERTY, YOU WANT TO REPAY ENOUGH TO KEEP IT
You have too much property which cannot be protected in a MARYLAND Chapter 7 Bankruptcy and which would result in having some of your property sold by the United States Bankruptcy Trustee to pay off some of your creditors. By filing Chapter 13 Bankruptcy, you will be given time to repay the creditors what they would have received from your property being sold in the chapter 7.
YOU CANNOT FILE ANOTHER CHAPTER 7 BECAUSE YOU FILED ONE IN THE LAST EIGHT YEARS AND YOUR CREDITORS ARE THREATENNG YOU NOW!
You filed a Chapter 7 bankruptcy within the last eight years and now you cannot file for Chapter 7 again but you are behind with your bills and your creditors are threatening to sue you or even worse, garnish your wages.
YOU OWE BACK MARYLAND STATE TAXES AND MARYLAND WILL NOT RENEW YOUR DRIVERS OR PROFESSIONAL LICENSE
You owe Maryland State taxes which are not dischargeable and Maryland will not renew your driver’s license, your professional license, or will not register your car because of the back taxes so you file a chapter 13 to repay these debts over five years while keeping your ability to retain your license or registration during that time.
A FRIEND HAS CO-SIGNED A LOAN FOR YOU AND YOU WANT TO PROTECT THEM BUT YOU STILL NEED HELP WITH THE REST OF YOUR DEBTS
You have a loan with a person who has cosigned the debt with you and you don’t want the creditors going after them if you file chapter 7. By filing the chapter 13, you are allowed to payback the debt with the co-debtor more than you repay the rest of your creditors causing the creditors to leave your co-debtor alone during the bankruptcy case. In the case of paying back the creditor 100%, your co-debtor may not owe any money at the conclusion of your chapter 13 case.