How Do I Qualify for Chapter 13 Bankruptcy?

In filing Chapter 13 Bankruptcy, getting a bankruptcy lawyer is not mandatory. You can always file it by yourself. However, it is always worthy to note that the bankruptcy law, as well as the bankruptcy process is highly complex. If it is your first time filing for Chapter 13, the first question that you need to determine is “how to qualify for Chapter 13 Bankruptcy in Oregon?” Unsecured debt can be one of the most frustrating things you can go through. You can use Chapter 13 bankruptcy to stop home foreclosure, pay back taxes, make up for a missed mortgage or car, stop interest from increasing your tax debt, and a lot more. Indeed, filing for bankruptcy offers wise legal remedies, but what is more important is the bankruptcy lawyer that you are working with. Keep in mind that in Chapter 13, you will be working with your lawyer for up to 5 years. If a trusted and skilled bankruptcy attorney is what you are looking for, Michael D. O’Brien & Associates, P.C. is the right bankruptcy firm to call. Michael D. O’Brien and Theodore J. Piteo are the two out of three nationally-certified consumer bankruptcy attorneys in Oregon. With our substantial years of experience of helping clients solving debt problems, rest assured your case will be handled diligently. If you still have questions about how you can get qualified for Chapter 13 Bankruptcy in Oregon, set a free case evaluation today!

Examples of inexcusable debts are: those for malicious or willful damage that caused death or personal injury; obligations of domestic support, such as spousal or child support; damages for personal injury which resulted by malicious or willful act; damages for personal injury or death due to driving under influence; student loans; criminal fines on criminal conviction; debts incurred through fraudulent acts; and tax debts.

• Justification for Inability to Pay Remaining Amount. You may be justified for not paying the remaining amount of the unsecured debt. This benefit is only available after you have made all necessary payments and met all applicable requirements. Examples of inexcusable debts are: those for malicious or willful damage that caused death or personal injury; obligations of domestic support, such as spousal or child support; damages for personal injury which resulted by malicious or willful act; damages for personal injury or death due to driving under influence; student loans; criminal fines on criminal conviction; debts incurred through fraudulent acts; and tax debts.
• Payment Extension. While you are not allowed to discharge tax debts and student loans, you can get a payment extension to bring them up to date.
• Delay Home Foreclosure through Small Payments. You can delay or prevent home foreclosure by making small payments over time. This benefit is also used for back taxes. A lien created with a second mortgage on your household can also be removed.
• Reduce Monthly Dues. If your contract’s monthly dues are too high, you can reduce them, including the interest rates. However, house payments are not included and cannot be adjusted.
• Allowed to Disregard the Full Amount of the Creditor’s Claim. You can be allowed not to pay the full amount of the creditor’s claim. However, certain tax obligations have to be fully paid.
• Change or Stop Creditors’ Interest. You can change or stop the creditors’ interest from pursuing to collect the debts you owe in most cases.
• Payment Plan Proposal. You can propose a 3-5 year repayment plan.
• Halt Collection Activities. You can halt all or some collection activities against a co-signer or one of the debtors for your debts.
• Repossession of Your Property or Wage Garnishment. Without a bankruptcy court order, no one can repossess your property or garnish your income for debts incurred prior to filing for Chapter 13 bankruptcy.
• Pay More. In some cases, you may be able to pay more in order to pay off the plan sooner.
• Selling Properties. You can also propose selling your properties as part of the funds to be compensated through the plan.
• Changes to Plan. If a major change occurs due to unforeseeable events at the moment, you can propose changes to your plan that will help you in completing it. However, keep in mind that you cannot stop paying unless the bankruptcy court grants permission. If the change in circumstances is beyond your control, you may apply for a “hardship discharge” to have some of your debts discharged.
• Converting 13 to Chapter 7 Bankruptcy. You have the option of dismissing the case anytime, or convert the type of bankruptcy from Chapter 13 to Chapter 7 Bankruptcy.

As earlier mentioned, the law does not require you to have a bankruptcy lawyer. But since bankruptcy code is changing constantly, and Chapter 13 has a highly complex process, getting your Chapter 13 Bankruptcy attorney is highly suggested. Below will answer your question as to how to qualify for Chapter 13 Bankruptcy in Oregon.

• Eligibility. To be eligible for Chapter 13 bankruptcy, you must be an individual, a married couple, or the sole owner of a business.
• Stable Source of Income. You must have a stable source of income, whether it be from pension, spousal support, child support, or government benefits. A partnership cannot qualify for this type of bankruptcy.
• Unpaid Debt Amount. Upon filing Chapter 13 Bankruptcy, the amount of your unpaid debt must be lower than  $419,275, while your secured debt must be lower than $1,257,850.
• Receiving Discharge. Before filing for Chapter 13 bankruptcy, keep in mind that you will not receive a discharge if you received one in Chapter 7 bankruptcy in the previous 4 years.
• Financial Summary. You and your bankruptcy attorney must put together your financial summary which will demonstrate the amount of your unsecured debts and to whom you owe it. This should include your assets, monthly living expenses, as well as monthly income.
• Repayment Plan. One of the most important requirements for Chapter 13 bankruptcy is the creation of a repayment plan. You must prepare a repayment plan proposal for your debts. Your plan must include the capacity to make monthly payments to creditors via the bankruptcy trustee. The amount of your repayment plan will be determined by a variety of factors, including but not limited to expenses and income.
• Counseling Course Certificate. Completing a counseling course is required before filing a chapter 13 bankruptcy case. Upon completing the course, you must obtain the counseling course certificate, which is valid for 180 days.
• Debtor-education Course. After you file Chapter 13 Bankruptcy, you must again accomplish a debtor-education course. This is required before you can get the final discharge of your debts.
• Chapter 13 Trustee Appointment. After you file your Chapter 13 bankruptcy, the bankruptcy court will appoint a Chapter 13 trustee. You must submit a copy of your most recent federal tax return, including its transcript. You are also required to file all the necessary local, state, and federal tax returns before and during the commencement of the payment plan. Any federal refunds and net state you will receive, must be given to the bankruptcy trustee.
• Domestic Support Obligations. To receive your chapter 13 bankruptcy discharge, you must confirm that all domestic support obligations have been fully paid, or that your repayment plan will pay for all those obligations.
• First Payment. You will be required by bankruptcy law to make a first payment within 30 days upon filing bankruptcy, even though your plan is not yet approved by the bankruptcy court. Payments should also be on time. Otherwise, the bankruptcy chapter 13 trustee can legally dismiss your case. It is only the bankruptcy court who enjoys the sole discretion to authorize missed payments.
• 341 Hearing or Meeting of Creditors. The bankruptcy court will then schedule a 341 hearing or meeting of creditors. You must attend this hearing to answer queries about financial matters under oath. The main purpose of the 314 hearing is for the trustee to verify all the financial data you provided and make recommendations to the bankruptcy court to approve or reject your petition.
• Confirmation Hearing. At least 6 weeks following the 341 hearing, the bankruptcy court will then set another hearing called confirmation hearing. This hearing will determine whether or not your payment plan meets all the necessary requirements. It is also in this meeting that your creditors are allowed to raise their objections. If you have your bankruptcy lawyer, you are allowed not to attend this meeting.

This section lists the exemptions available in Oregon Bankruptcy. Keep in mind that the amounts used for bankruptcy exemptions in Oregon change on a regular basis. The following are the most common Oregon bankruptcy exemptions:

Homestead Exemption

The homestead exemption is divided into certain categories based on age.

• Married under 65 years of age: $50,000
• Married above 65 years of age: $50,000
• Single under 65 years of age: $40,000
• Single above 65 years of age: $40,000

Automobile Exemption

Oregon Bankruptcy Exemptions for automobiles is $3,000.

Jewelry Exemption

Oregon Bankruptcy Exemptions for jewelry is $1,800.

Tools of Trade Exemption

Oregon Bankruptcy Exemptions for Tools of Trade is $5,000.

Wildcard Exemption

Oregon Bankruptcy Exemptions for Wildcard is $400.

Personal Property Exemption

Oregon Bankruptcy Exemptions for personal property is $3,000.

Special Exception Handling for Oregon

The special exemptions for dealing with bankruptcy in Oregon are listed below.

Here are some additional common bankruptcy exemptions in Oregon that were not covered in the previous section. Keep in mind that there may be limits to the amount of the bankruptcy exemption, so you must check each of them one-by-one.

• 401(k) Plan
• 403(b) Plan
• IRA
• Alimony
• Annuities
• Disability Benefits and Income
• Health Savings Account
• Benefits of Social Security
• Unemployment Benefits and Compensation
• Worker’s Compensation

Federal Bankruptcy Exemptions

For federal exemptions, the pertinent rules are enshrined under 11 U.S.C. §562 of the Bankruptcy Code. You can also check the exemptions for federal bankruptcy as published by NCLC. The amounts of the exemptions expressed by the law are changing constantly. However, it is a well established rule in the Bankruptcy Code that states are allowed to “opt out” of using exemptions from federal bankruptcy. Many states would prefer to enact state-specific rules for bankruptcy exemptions. While other states allow debtors to choose between state and federal bankruptcy exemptions, there are also states that require you to use state-specific exemptions.

Choosing Exemptions

In Oregon, the bankruptcy law allows you to choose exemptions in federal bankruptcy. On the other hand, if you have lived in Oregon for at least 730 days prior to filing Chapter 13 bankruptcy, you can also use Oregon bankruptcy exemptions. If otherwise, then you are required to abide by the rules of the state in which you stayed for the greater part of the 180 days preceding the 730 day period. Some bankruptcy exemptions in Oregon, however, may not have the same benefits as the federal bankruptcy or bankruptcy exemptions in other states. If you are thinking of moving to Oregon or have recently moved, getting in touch with an experienced bankruptcy lawyer to discuss specific matters is a good decision.

Getting bankruptcy relief to get rid of your debts through Chapter 13 Bankruptcy is indeed a wise choice. If you are someone who wants to keep assets while, at the same time, preventing home foreclosure, pay back taxes, make up for a missed mortgage or car, and a lot more, a chapter 13 case might be the great option for you. However, it cannot be denied that the bankruptcy process is widely complex. While getting an attorney is not required, it will allow you to save more time and effort. Choosing an experienced, reputable, and dedicated Oregon lawyer should be your goal. The search is over with Michael D. O’Brien & Associates, P.C. In Portland, one of the board certified bankruptcy lawyers are Michael D. O’Brien and Theodore J. Piteo. We handled a lot of complicated bankruptcy cases in Oregon, and we thoroughly evaluated cases with great care. We are strongly dedicated to helping individuals getting out of debts and have a fresh start. Other than bankruptcy, we also handle debt alternatives and estate planning. If you are still searching for experienced and affordable bankruptcy lawyers in Oregon, you may set a free case evaluation today!