U.S. Supreme Court Upholds Viability of Chapter 13 Bankruptcy

U.S. Supreme Court Upholds Viability of Chapter 13 Bankruptcy

For many years, Chapter 13 bankruptcy has been a viable option for individuals who are facing serious financial struggles. Chapter 13 has been an effective way for these individuals to overcome their debt and recover financially. By filing for Chapter 13 people can hold onto many of their possessions as they pay off their debt under a new payment plan that satisfies their creditors. However, recently the viability of Chapter 13 was under serious question as the bankruptcy method went before the nation’s top court.

The United States Supreme Court ruled recently that assets and wages acquired by individuals after they file for bankruptcy protection will still be protected from creditors should their case be switched to a Chapter 7 filing. That means that Chapter 13 bankruptcy can still be a viable option for people facing serious debt who want to hold onto their assets. The court ruled that the law still complies with the U.S. Bankruptcy Code’s intent to help people get a clean start, even in those cases where a Chapter 13 case is changed over to a Chapter 7 case.

The news is good for anyone who chooses to file Chapter 13 bankruptcy, which allows individuals to keep many of their possessions as they agree to pay off their debt under a new agreement that typically lasts three to five years. If the nation’s top court had agreed with the lower court’s ruling the effects could have been very damaging for individuals who attempt to start over via Chapter 13, as they would have been penalized if they did not successfully meet the terms of their agreement. In any case, with the High Court’s ruling, individuals who file for bankruptcy will still have Chapter 13 as a viable option.

If you are in a situation where you are considering filing for bankruptcy this is good news for you. While, not everyone chooses Chapter 13 bankruptcy, it is the best option for many people. No matter which type of bankruptcy you choose, it’s important to speak with an experienced Merrillville bankruptcy lawyer before you proceed. Bankruptcy is a serious matter and you should understand all the implications before you make a decision. Let the experienced team at the Whitten & Whitten help you weigh your options and make the best choice for you. We are here to help, so give us a call as 219-756-0555. You can also reach us online by clicking here.