Filing an Emergency St. Louis Chapter 13

The United States Bankruptcy Court recognizes that in certain circumstances, it is necessary to file a St. Louis bankruptcy petition emergently. It understands that there are occasions when the normal route of preparing a case should be set aside because of factors that must be attended to immediately. And it is this added layer of protection that gives a Missouri or Illinois bankruptcy that much more strength.

The primary example of when an emergency St. Louis Chapter 13 bankruptcy would be filed is to stop a St. Louis foreclosure from taking place. When you fall behind on your monthly house payments to the bank, the remedy for the lending institution is to foreclose upon the loan. This allows the bank to sell the underlying collateral (the house) to the highest bidder at a foreclosure sale. But if a Missouri Chapter 13 is filed before the foreclosure date, then the sale is stopped. The Chapter 13 plan then goes into effect, and the arrearages on the mortgage loan (i.e. the amount that have fallen behind by) are paid back over a period of years. By spreading out the total amount in arrears that you owe to the bank, the court gives you a much better chance of coming current on that debt (than if you had to pay one lump sum).

Another example of when an emergency 13 would be filed is when your car is repossessed. The creditor who owns the note on your car can take back (i.e. repossess) the vehicle if you stop making monthly payments. This is typically not an action that you will be warned about in advance (indeed, most financing agreements have in the fine print something about repo’ing in the event of non-payment). Once the car or truck is repossessed, the holding company will keep the automobile on its lot for a period of between ten (10) to twenty (20) days before selling it. But if you file a Chapter 13 emergently, this prevents the company from selling your car and they have to give it back. Again, the Chapter 13 repayment plan will then take over, setting the amount to be paid each month to the creditor. One additional bonus to the car note being paid inside the 13 is that the repayment plan calls for an interest rate set at about five to six percent. This can be substantially lower than the interest rate of some loans, where rates in excess of ten percent are common. In this way, you would have a much lower rate, and therefore pay back far less than you normally would.

It is also important to point out that filing a Chapter 13 means that monthly, methodical payments are made each month by the Trustee to various creditors. This means that by the time you have completed your plan (three to five years later), you will have accumulated between 36 and 60 month’s worth of on-time payments dispersed to a number of creditors. The effect on your credit score will reflect this, as most people are pleasantly surprised to see how high their score had climbed while inside the plan.

The affordable St. Louis bankruptcy attorneys at The Bankruptcy Company have been making sure that clients receive the best individual care and protection possible for years. Our goal is to help guide you through the bankruptcy process in its entirety, and get you the fresh start / clean slate that you deserve.

Call us at (314) 932-1067 or contact us through our website The Bankruptcy Company to set up your free consultation with our experienced St. Louis bankruptcy attorneys.