Chicago Bankruptcy Attorneys: Chapter 13 Step Up Plans
In a typical Chapter 13 bankruptcy, the debtor pays one fixed amount to the trustee every month for five years. Many Chapter 13 plans fail because a lot can happen in five years, yet there is almost no wiggle room for unexpected expenses or hardships.
A Chapter 13 step-up plan allows debtors to pay a smaller amount at the beginning and gradually ramp up the monthly payment as life stabilizes and income increases. The experienced bankruptcy lawyers of Atlas Consumer Law can help you customize your Chapter 13 petition to put you in the best position for escaping from debt.
Our experienced Chicago bankruptcy lawyers represent individuals and couples throughout Illinois. Contact us online or by telephone at (312) 313-1613.
Chapter 13 Step-Up: Making Bankruptcy Affordable
The purpose of Chapter 13 bankruptcy is to help hard-working people bridge the gap when debts and hardships outpace earnings and expenses. Our core clients are professionals, business owners, executives and other high earners who need relief from foreclosure and other creditor actions.
A Chapter 13 step-up plan anticipates that your current income will grow moderately or substantially over the next five years. The initial payments are often 20 to 30 percent less so that you can afford the plan payments and have some left over to "live a little" and build up your reserves for the inevitable unforeseen expenses that throw your budget out of whack.
Bill and Melinda* upgraded from their Downer's Grove townhouse to a house in Oak Park, Illinois, to make room for the baby. They are squeezed by the mortgage, grad school loans, $53,000 in credit card debt and $22,000 in unexpected medical bills. However, Bill is fast-tracked for senior management and Melinda should make tenure within two years. Their modified Chapter 13 payments will start at $700 a month, then step up to $900 in the third year and $1,100 in the fifth and final year.
(A Chapter 13 can also be structured to "step down" in anticipation of a scheduled layoff, maternity leave, business liquidation or other expected decrease in income.)
Customize Your Illinois Bankruptcy Plan
Don't get trapped by high Chapter 13 payments that force you to live like a miser. Talk to the knowledgeable Oak Brook bankruptcy lawyers of Atlas Consumer Law about how to structure your case for immediate relief and long-term success.
*Bill and Melinda are fictitious characters created for the purpose of illustrating bankruptcy scenarios.
Contact Atlas Consumer Law online or call (312) 313-1613 to arrange a consultation.