In a corporate environment, business from all types of niche struggles to maintain its market share. A reflection of their revenue, customer base and profitability, a larger market share is an indication of a revenue-generating business model. Fundamental for the financial health and operational success of a business, it is necessary for a business to properly manage its working capital.
A defining characteristic of good business management is the capacity to harness working capital management to maintain a solid balance between growth, increased ROI and liquidity. Unfortunately, given the volatility of the market, most businesses face financial distress, which inches them closer to filing for bankruptcy.
Despite being a quick and easy process, filing for bankruptcy doesn’t discharge all debts and leads to loss of non-exempt assets.. An action with resultant implications, an attorney can help you decide whether filing for bankruptcy is a wise decision or not. A strong, experienced legal counsel, the attorneys working for Bankruptcy Law Center can help you make an informed decision, whereby they can help you choose appropriate routes. So, whether it is personal or business bankruptcy, their Chapter 13 bankruptcy attorneys in Orlando have years of experience in counseling both businesses and individuals for debt-related challenges. A seasoned bankruptcy attorney knows how to use Chapter 13 bankruptcy to reorganize and modify certain debts to make them easier to repay. That said, a Chapter 13 plan is only for individuals, not companies.
What Is Chapter 13 Bankruptcy?
Chapter 13 is a reorganization of debt, allowing debtors to repay all or a portion of their debts while protecting property and personal assets. It allows individuals with regular income to develop a plan to repay their debt. Under this chapter, debtors propose a repayment plan to pay installments to creditors over a period of three to five years. Any person, even if operating an unincorporated business or self-employed, is eligible for chapter 13 relief as long as the person’s secured debts are less than $1,257,850 and unsecured debts are less than $419,275 (as of February 2019). To be eligible for chapter 13, filers must have completed credit counseling. Following are the reasons to file for Chapter 13:
- Own your own home and are in danger of losing it because of financial problems.
- Are defaulting on debt payments, but can catch up if given time.
- Possess valuable property which is not exempt, but you can afford to pay creditors from your income if given time.
In some cases, certain individuals aren’t eligible for Chapter 7, which is when a Chapter 13 may be more beneficial. An optimal choice for certain clients, following are the benefits of a Chapter 13 bankruptcy plan.
- Retain Valuable Property
If you are behind on your mortgage payments, Chapter 13 will enable you to slowly and steadily catch up on your payments and save your home from foreclosure.
- Interest Rate
By opting for a Chapter 13 bankruptcy, you can end up paying lower interest to creditors if you meet certain qualifications..
- No Harassing Calls From Creditors
Under the FDCPA, you have the right to defend yourself against debt collectors who use abusive, deceptive and unfair practices. However, during a Chapter 13 bankruptcy, creditors aren’t allowed to communicate with you or contact you in any way. Immediately ceasing all collection efforts, filing for Chapter 13 gives you the time and space to pay back your debt, within a reasonable time frame.
- Save Home From Foreclosure
In normal scenarios, banks require borrowers to pay back their full mortgage arrearages once they’ve defaulted on their payments. For most individuals who find themselves struggling financially, this simply isn’t possible and leads them to lose their home to foreclosure. If you opt for Chapter 13, you’ll be able to become current in your payments to the mortgage company. In such an arrangement, past due amount is broken up into small, manageable pieces and are paid back over the course of the Chapter 13 plan. This allows you to avoid foreclosure, as long as you’re able to sustain monthly mortgage payments from the date the case is filed. If you income has dropped, you may qualify for a loan modification by filing Chapter 13 bankruptcy.