Chapter 13 Bankruptcy is also known as “Reorganization” and allows for your debt to be placed into a 3 to 5 year repayment plan that is designed to fit around your budget. Chapter 13 allows you to catch up on missed payments, while protecting your property from your creditors.

Upon the filing of a Chapter 13 Bankruptcy, an “automatic stay” will prevent any repossession of vehicles or foreclosure of properties while your payments are being made through the Chapter 13 plan. It will also stop wage garnishments and release your license from suspension. A great majority of individuals who filed for Chapter 13 are doing so to save their home or vehicle, and to become current one again on their loans.  However, there are other reasons that may make a Chapter 13 bankruptcy necessary instead of a Chapter 7, such as having unprotected equity in property or earning too much income. Come speak with our staff for further information.

A Chapter 13 Bankruptcy treats debt differently than a case under Chapter 7. In a Chapter 13, unsecured debt is being paid back at a percentage of what is owed, based on what your income allows. This could be as little as 10%. Most Tax debts and child support arrears must be paid in full. Secure debt arrears must be paid back in full through the plan for you to be able to retain the property. However, when your property or vehicle is under secured, this leads to many other options. Our knowledgeable staff is able to critically analyze your situation to give you all your options, before you have to make decisions.

At the end of your Chapter 13 plan, all unsecured non-priority debt that has not been paid will be discharged as it would under a Chapter 7 bankruptcy. Your home will be current, your vehicle paid off, and you will be back on track. Schedule an appointment today to see what we can do to help.