Foreclosure Attorneys in Waterbury, CT 

Bankruptcy is a multifaceted legal procedure that can offer a new beginning for individuals grappling with significant debt. One of the most common forms of bankruptcy filed by individuals and small businesses is Chapter 13.

Using Chapter 13 Bankruptcy to Stop CT Foreclosure

Chapter 13 bankruptcy is a great option for those who want to avoid foreclosure on their homes or prevent repossession of their cars. It can also stop wage garnishments and potentially discharge some debt at the end of your repayment period.

Chapter 13 bankruptcy, also referred to as the "wage earner's plan," provides individuals who have a consistent income with a mechanism to formulate a strategy to repay all or a portion of their outstanding debts. This contrasts with Chapter 7 bankruptcy, which involves liquidating and selling your assets to settle your debts. Instead, Chapter 13 offers the benefit of retaining ownership of your property while gradually paying down your debt, typically over a span of three to five years.

It is important to note that Chapter 7 bankruptcy can also be an option for those seeking to stop foreclosure. Chapter 7 bankruptcy does allow the discharge of debts like medical expenses and certain kinds of loans.

To qualify for Chapter 13 bankruptcy, you need to demonstrate that you're capable of meeting the requirements of the repayment plan. Therefore, this type of bankruptcy is most suitable for individuals who have a steady stream of income.

Before filing, you will also be required to complete credit counseling from an office approved by the U.S. Trustee’s office. You will also need to: 

• Complete several forms detailing your debts, income, expenses, and assets and pay the application fee. 
• Propose a repayment plan that details how you will pay each of your debts.
• Work with your assigned bankruptcy trustee, who will be appointed to oversee your case.
• Participate in a confirmation hearing, during which a judge will make a decision to either endorse or reject your proposed repayment strategy.

Given the complexities involved, hiring an experienced bankruptcy attorney is highly recommended. The cost of a bankruptcy attorney varies, but it's important to consider this an investment in your financial future and in safeguarding your home.

You should also be aware that after filing for Chapter 13 bankruptcy, you're expected to live on a strict budget while you repay your debts. It's crucial to stick to your repayment plan and avoid taking on new debt. While a Chapter 13 bankruptcy may stay on your credit report for a maximum of seven years, a lot of individuals begin the process of credit restoration shortly after their bankruptcy has been cleared.