Managing Attorney Chris Jones was recently interviewed about filing for bankruptcy and the benefits of Chapter 13 bankruptcy.

Managing Attorney Chris Jones was recently interviewed and featured in an informational article about filing for bankruptcy and the benefits of Chapter 13 bankruptcy.  Chris is a Board-Certified Consumer Bankruptcy Attorney with over 20 years of experience.

Here are some article highlights: 

• Bankruptcy is often a misunderstood financial tool.   The most common perception is that filing for bankruptcy will damage your credit and should be a last resort.  The reality is that the Chapter 13 repayment plan offers many unique tools that can dramatically improve the circumstances of someone facing financial challenges or distress. 
  
  “The biggest thing that people struggle with in regards to credit is their debt-to-income ratio. That’s what can drag credit scores down, but when Chapter 7 or 13 cases are filed, those credit line items update to zero balances.” ~ Chris
    

• Working with a firm that specializes in bankruptcy and specifically Chapter 13 is key to success, as the process of filing a Chapter 13 is unique to each person filing, is very nuanced and requires a well-versed law firm.
  
  “Some attorneys dabble in bankruptcy work, but it’s my opinion that specialization is key,” Jones told us. “I get a lot of calls from people who are seeking a substitution of attorney midway through their case because an attorney who doesn’t specialize in bankruptcies took their case and didn’t help them.”   Chris
    

• Carefully consider “quick fixes” like accepting a loan modifications vs filing a Chapter 13.  If you have a low interest rate, you can preserve that through the Chapter 13 process vs. losing a favorable rate and paying more in overall interest with a loan modification.  Consider the long-term implications of your decision, run the numbers and make sure you understand the long-term costs.  For example, Chapter 13 allows you to keep your current interest rate and modify the payment of arrearages over the course of 36 -60 months.  A loan modification is a 30+ year commitment and added interest charges can really snowball over time.
  
  “Mortgage companies have basically put people in a bad position by offering forbearance agreements with an assurance of assistance when the forbearance period expires only to commence foreclosure proceedings, and they then use the leverage they have to get borrowers to acquiesce to a mortgage modification with higher interest rates and longer terms,” Jones told us. “Chapter 13 is a very effective tool to avoid that situation and give you another outlet.” ~ Chris
    

To read the full article, click HERE