Boston Bankruptcy Lawyer

Creditors Contesting Repayment Plan

Under Chapter 13 bankruptcy, a debtor enters into negotiations with a bankruptcy trustee to determine the total amount he or she will have to pay to a variety of creditors each month. All of the debts are added up and the entire thing is negotiated in a way that the debtor will end up paying less than originally owed. The lump payment is sent directly to the trustee who then divides it up among the creditors according to the repayment plan.

These plans work rather well and allow a bankrupt individual to hold on to many of his or her possessions, rather than losing everything in liquidation. Credit card debts are typically reduced or discharged, as well as any number of other debts.

Unfortunately, the creditors have the ability to contest a repayment plan prior to it being approved by a judge. Just because the debtor and the trustee feel it’s a wonderful idea does not mean that a creditor will agree with those two.

Typically, creditors object because they feel that they are being asked to give up too much of their debt or given too little interest.

Much of this worry can be avoided if a skilled bankruptcy trustee works with the creditors while drawing up the repayment plan in the first place. When the trustee listens to the creditors’ concerns, while keeping the debtors’ needs first in his priority list, the entire process is much smoother.

Contact a Boston Bankruptcy Lawyer

If you are considering filing for bankruptcy because of an insurmountable amount of debt, contact the Boston bankruptcy lawyer of Joshua Spirn & Associates at 1-800-975-5346 to discuss your situation and to determine which type of bankruptcy works best for you.