Debt can feel like a crushing weight, impacting your financial well-being and overall quality of life. If you're a Wisconsin resident struggling with overwhelming debt, you might have heard about Chapter 128. But what is it, and could it be the right solution for you? This blog post will explore Chapter 128 debt consolidation in Wisconsin, helping you understand its intricacies and whether it aligns with your financial situation.
What is Chapter 128?
Chapter 128 is a debt consolidation plan specifically designed for individuals with regular income. It allows you to consolidate your debts into a manageable repayment plan lasting three years.
How Chapter 128 Works in Wisconsin:
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Filing the Petition: You file a petition with the court, along with a proposed repayment plan. This plan outlines how you will repay your creditors over the designated period.
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Repayment Plan: The plan consolidates your debts, and you make regular payments to a trustee who then distributes the funds to your creditors.
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Secured vs. Unsecured Debt: Chapter 128 treats secured and unsecured debt differently.
- Secured Debt: This is debt tied to collateral, like a mortgage or car loan. You'll generally need to continue making payments on secured debts to keep the asset. These are not debts to include in a Chapter 128.
- Unsecured Debt: This is debt that isn't tied to collateral, like credit card debt or medical bills. These are the debts to include in a Chapter 128.
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Trustee: A trustee is appointed to oversee your Chapter 128 plan. They collect your payments and distribute them to your creditors according to the plan.
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Completion: Once you successfully complete all the payments outlined in your plan, the remaining dischargeable debts are eliminated.
Benefits of Chapter 128:
- Debt Consolidation: Combines all your debts into a single, manageable monthly payment.
- Protection from Creditors: Stops wage garnishments
- Keeping Your Assets: Unlike Chapter 7, you generally don't have to liquidate your assets.
- Less Complex than Chapter 13: Often simpler and less expensive than Chapter 13 bankruptcy.
Is Chapter 128 Right for You?
Chapter 128 might be a good option if you:
- Have a regular income but are struggling to manage your debt.
- Want to consolidate your debts into a manageable payment plan.
- Want to protect your assets.
Attorney Nathan DeLadurantey offers free consultations to explain your legal rights in Wisconsin. Free consultations can be scheduled online.
