Lucas Ruffing Law

Chapter 13 Example Case

How Chapter 13 Bankruptcy Could Benefit You

TURN CHAOS

Before Chapter 13 Bankruptcy:

Taylor’s Bills:

  • $1,575/mo

    • $650/mo mortgage payment

    • $450/mo car payment

    • $225/mo furniture payment

    • $250/mo student loan payment

  • $5,000 on credit cards

  • $25,000 in medical bills

  • $6,000 in repossessions

  • $2,000 on phone/cable/internet bills

  • $800 on utilities

  • $1,200 in taxes to the IRS/State

Taylor’s Pre-Bankruptcy Financial Situation:

  • Taylor has a kid and makes $53,000/year

  • Owns a 2008 Pontiac G6 free-and-clear, worth $4,000

  • Purchasing a 2013 Chevy Impala she bought NEW

    • Car is worth $9,000

    • Taylor is facing a repossession

  • Buying a house

    • Taylor is behind 2 months on the mortgage

  • Buying furniture from 1.5 years ago

    • Worth $800 owes $3,500

  • Student Loans

    • Owes $35,000

That’s a lot of bills. Attempting to keep track and making payments to all of them seems impossible to Taylor.

 

INTO CALM

RESULT of CHAPTER 13 BANKRUPTCY:

1 simple payment* = $987/mo for 60 months
*INCLUDES the house, car, furniture,
  student loans, taxes, and all the other bills

Taylor would only pay $987/month and would no longer have payments for a car, mortgage, student loan, taxes, furniture, wage garnishment, medical bills, credit cards, etc.

After the Chapter 13 bankruptcy is completed, Taylor would have to continue the mortgage payment and would still owe student loans, but Taylor would now:

1) OWN the 2013 Chevy FREE-AND- CLEAR
2) OWN the furniture
3) RESET the following to $0:

  • Credit cards (no longer owes $5,000)

  • Medical bills (no longer owes $25,000)

  • Repossessions (no longer owes $6,000)

  • Phone/cable/internet bills (no longer owes $2,000)

  • Utilities (no longer owes $800)