First of all, there is no Chapter 20 in the Bankruptcy Code. The term “Chapter 20” is a shorthand term where the individual or married couple has filed a Chapter 7 and shortly thereafter filed a Chapter 13.
When the homeowner is faced with a foreclosure and has no present ability to file a Chapter 13 to save the property a Chapter 7 may be appropriate. In addition to mortgage defaults, there is likely a good deal of other debts. The discharge in a Chapter 7 relieves the person from his/her/their debt obligations.
But circumstances change. For instance, a married couple may have separated and both incomes were required to successfully file a Chapter 13. Being separated a Chapter 7 was the logical avenue so they could get a “fresh start.”
After the Chapter 7 discharge, the couple reconciles and now has sufficient income to pay the current mortgage; make payments to the Chapter 13 trustee, and have a sufficient amount for their everyday living expenses.
Courts, trustees, and mortgagee may look at such a “Chapter 20” with suspicion. But if circumstances have changed for the good the Chapter 13 should be confirmed and the debtor will be given a chance to save the home.
There are, of course, other changes in circumstances following a Chapter 7 discharge. An unemployed or underemployed Chapter 7 debtor may get a good-paying job. The list of positive changes of circumstances following a Chapter 7 could on and on.
Good things sometimes happen to good people.
The point is that something good happened after the Chapter 7 discharge. And the subsequent Chapter 13 case is being filed in “good faith.”
General Information:
For more information on Chapter 20 Of Bankruptcy Code, a Complimentary consultation is your next best step.
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ELIMINATE YOUR DEBT
The first step to finding relief is to get rid of the mountain of debt you have been carrying around. Bankruptcy can provide you with a clean slate to start from.
BRING UP YOUR CREDIT SCORE
After you have gotten out from under your debt, you can begin the process of rebuilding your credit score and position yourself for greater opportunities in life.
START A NEW CHAPTER
You don’t have to remain buried under debt forever. There are bankruptcy options available that may be able to you that may give you a new start with your finances.