Say Goodbye to Debt
This is in our larger ever-continuing series, 3 Minutes to Financial Freedom. I’m going to post a video every weekday.
So, to review, is chapter 13 right for Me, three factors.
My income, is it above or below the IRS median standards currently in effect? If it’s above, I’ve got to pay for 5 years, monthly. If it’s below, I’ve got to pay for at least 3 years, but I can pay up to 5 if I need that much time to pay everything off. For example, if I’m trying to save my house.
Remember, chapter 13 payment is not based on what you owe unless you need it to be. In general, it’s just based on what you can pay.
So, the second factor, is what kind of debt? Is this really going to help me? We talked about student loans, not only aren’t dischargeable but they can’t be jumped ahead of your credit cards and other things. So, at the end of this, what am I going to have left? That’s what you want to look at.
IRS, taxes, things like that, you can jump ahead. Secured notes, and cars, you can jump those ahead. So, it may be, even though you make a big payment, that’s a payment you would have made anyway, and you have a ton of unsecured debt. Left at the end of the five years, which means it gets discharged just like a 7, which is good. That’s what you want.
Again, unsecured debts, credit cards, signature loans, medical bills, and old utilities. You got a lot of that left at the end, that’s the more that you’re going to discharge. You can also do a 100% plan, where it’s going to freeze in an amount, and at the end of five years, you know you’re going to be done. This is trying to slug it out, out of bankruptcy, when interest and compounding rates and attorney fees, it’ll kill you. You’ll never get out of it.
So, what kind of debt have you got? The third thing, maybe the most important, is just feasibility. Can I do this? Do I make enough money, and do I have the discipline, or can I, you know, at least force myself long enough to do this for three to five years and get it done? It’s such a powerful tool, and I hope all of you will reach down to get that discipline and use this to help you.
But what you don’t want is that you know, you’re four and a half, things fall apart, you stop making payments, the case gets dismissed, and all that debt that would have been discharged in six months comes back. And, you know, you don’t want that.
So, you know yourself, and you know what I’m saying. Three factors, again. What’s your income? What’s the makeup of your debt? And feasibility.
So I hope this has been helpful. If you understand, if a 13 is right for you, as always, you can reach out to me, an Oklahoma City Chapter 13 lawyer, directly, EdwardKelleyLaw at gmail.com, that’s K-E-L-L-E-Y-Law at gmail.com, or call me at 580-478-3130. And I’ll see you next week with more videos, Three Minutes to Financial Freedom.