Understanding and Utilizing Wisconsin's Debt Relief Option

If you're a Wisconsin resident struggling with overwhelming debt, Chapter 128 debt consolidation might be a viable solution. This state-specific-non-bankruptcy law offers a unique opportunity to reorganize your debts and create a manageable repayment plan.

What is Chapter 128 Debt Consolidation?

Unlike traditional bankruptcy, Chapter 128 allows you to keep your assets while restructuring your debts. It can be used by individuals with unsecured debts, such as credit cards and medical bills.

Key Benefits of Chapter 128

• Debt Repayment Plan: You'll create a court-approved repayment plan that fits your budget.
• Interest and Penalty Freeze: Interest and penalties on your debts will be paused during the repayment period.
• Asset Protection: You can generally keep your home, car, and other essential assets.

Eligibility Requirements

To qualify for Chapter 128 debt consolidation, you must meet the following criteria:

• Debt Type: Your debts must primarily be unsecured (e.g., credit cards, medical bills).
• Income: You must have regular employment income

The Chapter 128 Process

1. Consultation with an Attorney: Seek advice from an attorney specializing in Chapter 128 to determine if it's the right option for you.
2. Filing the Petition: Your attorney will file a petition with the court, outlining your situation and proposed repayment plan.
3. Automatic Stay: Once the petition is filed, a stay goes into effect, temporarily halting certain collection efforts by creditors.
4. Repayment Plan: You'll work with your attorney to develop a feasible repayment plan that addresses your debts. 
5. Confirmation: The court will review your repayment plan and confirm it if it meets the legal requirements.
6. Repayment: You'll make regular payments to a court-appointed trustee, who will distribute the funds to your creditors.

Important Considerations

• Court Supervision: Chapter 128 is a court-supervised process, which means you must adhere to specific requirements and deadlines.
• Credit Impact: Filing for Chapter 128 will have a significant impact on your credit score.

Conclusion

Chapter 128 debt consolidation can be a powerful tool for Wisconsin consumers struggling with overwhelming debt. By understanding the eligibility requirements, benefits, and potential drawbacks, you can make an informed decision about whether this option is right for you. It's essential to consult with a qualified bankruptcy attorney to explore your options and navigate the complexities of this legal process.