A Chapter 13 Bankruptcy is a government sponsored debt consolidation plan that does just that. It consolidates your debt into a 3-5 year plan. In the vast majority of cases, you pay your creditors back over 3-5 years. Whatever doesn’t get paid off, gets wiped out tax free, forever!
Let’s use an example. Say you have 100k in credit card debt. You can afford to pay $200.00 per month over 60 months. At the end of 60 months, you have paid 12k right? Now, you say, and correctly so, that is not enough money to pay back your 100k in debt, so what happens to the 88k that doesn’t get paid back? That 88k gets wiped out, tax free, forever!
Chapter 13 Bankruptcy is the very reason no one should do traditional debt consolidation. Traditional debt consolidation looks terrible on your credit, write offs are taxable to you, and some creditors may not participate leaving you in limbo and wondering if they will garnish your wages instead. It happens all the time. I feel terrible for people who do traditional debt consolidation. If you want peace and control, doing a Chapter 13 Bankruptcy is the only way to go.
When the time is right, or when you are ready, reach out to Minnesota’s HIGHEST GOOGLE REVIEWED bankruptcy law firm at www.kainscott.com. You will be happy you did.