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Medical Debt Crisis In North Carolina

Excellent News! Chapter 13 and Subchapter V Debt Limit Increase Effective Date: June 8, 2022

How does North Carolina’s bankruptcy law work? The North Carolina bankruptcy laws explain the legal procedure through which debtors and creditors settle unpayable debts. During a bankruptcy proceeding, the courts will appoint a trustee whose responsibility is to identify the best course of action to ensure creditors recover as much of the money due as possible while relieving the debtor of his or her financial responsibilities. In many instances, this entails the liquidation of non-exempt assets and property in North Carolina in order to partially pay back creditors. Then, any outstanding obligations are canceled. Alternately, a structured repayment plan lasting between three and five years might assist the debtor in meeting their financial obligations and provide them time to pay off their debts.

Excellent News! Chapter 13 and Subchapter V Debt Limit Increase Effective Date: June 8, 2022. Yesterday, the House of Representatives passed the Bankruptcy Threshold Adjustment and Technical Corrections Act, which raises the debt cap for Chapter 13 bankruptcies to $2.75 million. The debt ceiling for unsecured debt was $465,275 while for secured debt it was $1,395,880. Due to the rise in the debt ceiling, more people will be eligible for Chapter 13, which is a far more inexpensive alternative than Chapter 11.

In addition, the debt ceiling for small business debtors in Subchapter V Chapter 11 was increased to $7.5 million. This will aid several small firms that can benefit from the less expensive Subchapter V alternative.

The bill is now on its way to the President’s desk for signature. Due to the bill’s expiration in two years, it is of the utmost importance that individuals with heavy debt burdens file for bankruptcy immediately and take advantage of chapter 13 and subchapter V debt limit increase.  For legal assistance on bankruptcy contact Hoard Law.