Life's curveballs—the loss of a job, a sudden medical emergency, or mounting credit card bills—can put you in a difficult financial situation. When experiencing the distress of overwhelming debt, filing for bankruptcy may be a legal option to remedy your financial condition and achieve debt relief. If you are considering filing for bankruptcy under Chapter 13 of the U.S. Bankruptcy Code, consulting with an experienced New Mexico bankruptcy attorney is important for detailed guidance.
At the Law Office of Jason Cline, I have devoted my career to offering knowledgeable and comprehensive legal guidance to clients in bankruptcy-related matters. I'm available to discuss your unique financial situation and help you understand your possible bankruptcy options. As your legal counsel, I can provide you with the detailed legal counsel, support, and reliable advocacy you need to navigate the complicated procedures surrounding Chapter 13 bankruptcy in New Mexico.
My firm – the Law Office of Jason Cline – proudly serves clients throughout Albuquerque, Rio Rancho, Santa Fe, Los Lunas, or anywhere throughout the state of New Mexico.
Chapter 13 bankruptcy, also referred to as "repayment plan" bankruptcy, is a debt relief option available to consumers who earn a decent income but are overwhelmed with debts. In Chapter 13, the debtor will propose a repayment plan, spread over three to five years, to pay back their debts using their future income. At the end of the Chapter 13 repayment plan, some of your unsecured debt may be discharged.
Chapter 13 may be an ideal debt relief option when:
You have non-exempt assets that you want to keep.
You need sufficient time to pay back your debts or recover on past-due payments.
You are late with your car loan or mortgage payments.
The majority of your debts can't be discharged. Such debts may include tax obligations, fines and penalties, or domestic support obligations such as alimony and child support payments.
You have a co-debtor on a consumer or personal debt.
An experienced attorney can help determine when Chapter 13 is a good debt relief option for you and enlighten you about what Chapter 13 can do for you.
Filing for bankruptcy under Chapter 13 of the U.S. Bankruptcy Code can help you in the following ways:
Affords you more time to pay back your debts through a repayment plan
Gives you the time you need to catch up on past-due payments and debts while keeping your assets
Allows you to reschedule and extend your secured debts over the life of the repayment plan
Helps rebuild your credit score gradually over time
Allows you to discharge some unsecured debts at the end of the plan
Allows you to apply for new credit lines within a few years of filing
Activates an "automatic stay," which is a court order that immediately halts all debt collection, creditor harassment, and wage garnishment
Activates an "automatic stay" that delays or prevents an eviction, foreclosure, or repossession on your property
While this bankruptcy option can help consumers in many ways, there are some things a Chapter 13 plan can’t do. These include:
It will not leave you destitute.
It will not eliminate any of your priority debts, such as fines and penalties, federal, state, and local taxes, criminal restitution, liens, and debts from fraud.
It will not eliminate your student loan debts, except in extreme circumstances.
It will not alleviate your domestic support obligations like alimony and child support payments.
A knowledgeable bankruptcy lawyer can evaluate your financial situation and determine your eligibility for Chapter 13 bankruptcy.
To qualify for Chapter 13, you must show the New Mexico bankruptcy court that:
You are up-to-date on your tax filings.
You are within the debt limitations, meaning your unsecured debts are less than $394,725, and your secured debts are less than $1,184,200.
You are employed and have enough income to cover the proposed monthly payments after subtracting expenses and payments.
You are filing as an individual and not as a business.
However, debt amount limitations are modified periodically to show changes in the economic situation and the consumer price index.
You must take a mandatory credit counseling course from an approved U.S. Trustee agency in New Mexico before filing. Additionally, you will take another debtor course after filing for Chapter 13 to receive your bankruptcy discharge.
As mentioned earlier, filing for Chapter 13 bankruptcy requires you to propose a repayment plan to your creditors and the court while taking all your debts into account. The court-appointed bankruptcy trustee and your creditors will be allowed to review and object to your plan or make necessary adjustments. Once every party is satisfied, the New Mexico court will set up a confirmation hearing where the proposed repayment plan will be reviewed and officially approved.
At the confirmation hearing, the bankruptcy judge will review the plan and certify that:
The repayment plan is feasible.
You can make the monthly payments.
The repayment plan meets the terms and conditions of bankruptcy law.
You filed the repayment plan in good faith, and you can repay most of your unsecured creditors.
An experienced bankruptcy attorney can evaluate your proposed plan and ensure that it meets statutory requirements.
Filing for bankruptcy in New Mexico involves several complexities, and navigating the complicated bankruptcy procedures alone isn't advisable. According to the American Bankruptcy Institute, there were 2,423 total bankruptcy filings in New Mexico in 2020, including about 246 Chapter 13 cases. These consumers didn't go through this alone and neither should you. When considering filing for bankruptcy, consulting with an experienced bankruptcy attorney is crucial to help you move forward.
At the Law Office of Jason Cline, I have the experience and resources to assist and guide clients through the complexities of New Mexico bankruptcy proceedings. As your legal counsel, I can review your unique financial situation, explore your available options, and determine whether Chapter 13 is right for you. Also, I can help with the required documentation, represent you in bankruptcy court, and guide you through every phase of the legal process. I will help simplify the Chapter 13 bankruptcy process for you and guide you on your road to financial recovery.
If you are considering filing for Chapter 13 bankruptcy, contact my firm – the Law Office of Jason Cline – today for a simple consultation. I can offer you the experienced legal counsel and strong advocacy you need to navigate important decisions. My firm is proud to serve clients across Albuquerque, Rio Rancho, Santa Fe, Los Lunas, or anywhere throughout the state of New Mexico.