subject: Creditors Face Tougher Rules for Chapter 13 Payments [print this page] There is a misconception that the 2005 bankruptcy amendments give more authority to creditors in bankruptcy court. But, the United States Supreme Court recently held in favor of creditors. This gives bankruptcy judges more room to allow for unique income circumstances in Chapter 13 payments.A Chapter 13 bankruptcy allows an individual to reorganize their debts into a monthly payment plan that seems fair to everyone involveddebtors, creditors, and bankruptcy trustees. A Chapter 13 bankruptcy is supposed to allow monthly Chapter 13 payments which are affordable and is determined by the debtor's income, among other criteria. In Hamilton v. Lanning, the debtor in this case, did not have a high income, but was paid a large short-term sum from a former employer. Her creditors abused the facts of her situation to argue for a much larger Chapter 13 payment than she could possibly pay. The Supreme Court, in an 8-1 decision with Justice Scalia dissenting, supported the debtor's view that her Chapter 13 payments should not be based off her temporarily inflated monthly income, but by her normal expected income.The Supreme Court shows that bankruptcy understands the needs of debtors when considering Chapter 13 payments--a lot more than people think. While creditors want to get the most money possible from a debtor and will abuse the facts to do sothis case has proved that the end result of a bankruptcy should be in the best interest of you, the debtor.Everyone who is considering a Chapter 13 bankruptcy will welcome this development. It reaffirms the position that bankruptcy is there to protect working people and to help them get back on their feet. It also shows the power of a good Chapter 13 bankruptcy attorney. If you are thinking about a Chapter 13 bankruptcy, you can file for yourself, but you should consider the benefits of hiring a bankruptcy attorney. Any bankruptcy lawyer worth their salt will follow the most recent cases in bankruptcy law so that they can get you the most fair Chapter 13 payments.What should you look for in a good bankruptcy lawyer? Do your research! Try to find a bankruptcy lawyer that offers free materials on every new part of Chapter 13 bankruptcy law. Any bankruptcy attorney that takes seriously informing their clients about every step of a bankruptcy is a lawyer with your interests in mind. And, fortunately, so does the U.S. Supreme Court!
Creditors Face Tougher Rules for Chapter 13 Payments
