About Chapter 13
(Please note: at the present time, Alan Pressman is not taking on any new Chapter 13
cases involving mortgage arrears or a foreclosure)
Chapter 13 is typically filed when you want to stop a foreclosure or when you have too much
equity in your house to file a Chapter 7. Once a Chapter 13 is filed with the Bankruptcy Court,
it immediately stops a foreclosure. Usually, you can repay your mortgage arrears through the
Bankruptcy Court, over a five (5) year period.
Chapter 13 also enables you to consolidate your unsecured debts (such as credit cards, medical
bills, bank loans, personal loans) into one monthly payment -- and in Chapter 13 you can often
pay back as little as 10% of your unsecured debt -- over a five (5) year period -- with no
interest.
Taxes, such as income taxes and property taxes can also be consolidated in with the monthly
Chapter 13 payment and usually can be paid back, through the Bankruptcy Court, over a period
of five (5) years.
In Chapter 13, you always keep all of your assets -- the Bankruptcy Court has no right to take
any of your property away from you -- even if you own a house with a lot of equity.
If you have too much equity in your house to file a Chapter 7 bankruptcy, you will want to file a
Chapter 13 bankruptcy instead. In Chapter 13, you will have no risk of losing your house.
Even if you have a lot of equity in the house, you will still definitely keep it. But if you have a
lot of equity in your house, you will be required to pay back a percentage of your unsecured
debt in the Chapter 13. How much you have to pay back to your creditors typically depends on
how much equity you have in your house (i.e. the more equity you have, the more you will have
to pay back to your creditors). Whatever amount you do have to pay back to your creditors,
you will normally be given five (5) years to do so -- you will most likely be making monthly
payments to a bankruptcy trustee.
If your house is in foreclosure, the Chapter 13 must be filed before the foreclosure sale date in
order to stop the foreclosure. Even if you have received a foreclosure summons from your
mortgagee, you still can file a Chapter 13 and stop the foreclosure and get five (5) years to pay
back your mortgage arrears through the Bankruptcy Court. From the time you receive the
foreclosure summons, it takes at least several months for the mortgagee to get to the point of the
foreclosure sale. (The total time it takes depends to a large extent on how quickly the
mortgagee moves in terms of proceeding with the foreclosure).
You can stop the foreclosure at any time prior to the date of the foreclosure sale by filing a
Chapter 13 bankruptcy.
Once the Chapter 13 petition has been filed with the Bankruptcy Court, starting with the month
after you filed the Chapter 13, you will resume making your regular monthly mortgage payments
(your bank will have to accept them since you are in a Chapter 13). And you will have an
additional payment to make each month (usually for a period of 60 months) to a bankruptcy
trustee. (This is a specific attorney appointed by the Bankruptcy Court to administer the
Chapter 13 case. In Suffolk County there are presently two different attorneys who handle the
Chapter 13 cases -- Marianne DeRosa and Michael Macco). Your first payment to the
bankruptcy trustee will be due thirty (30) days from when your Chapter 13 petition was filed.
If you would like a free consultation with Alan Pressman on Chapter 13 bankruptcy, call (631)
234-3883.
1797 Veterans Highway
Islandia, N.Y. 11749
I have been practicing law at the same Islandia location for more than 25 years.
(Long Island Expressway, exit 57-- 1/4 mile southeast; across from the Islandia Shopping
Center)
I have been actively handling Chapter 13 bankruptcies on Long Island since 1981. My practice
is 100% handling bankruptcy cases. I am a solo practitioner and, as such, I will handle your
case personally.