Chapter 13 bankruptcy is known as a wage earner's plan. It is a way for individuals with regular monthly income to repay some or all of their debts. Rather than surrendering assets for liquidation, the debtor presents a payment plan for confirmation. If Court approved, the debtor will make monthly, plan payments to the Chapter 13 trustee for a period of 3 to 5 years. Any debts remaining thereafter are effectively discharged. By filing Chapter 13, a qualified filer facing foreclosure can stop the foreclosure and harassment from lenders and other creditors. This also allows the debtor breathing room to course correct their financial future.

Chapter 13 bankruptcy eligibility is based on the total amount of debt, secured and unsecured, a client possesses. Secured debts are mortgage and car loans. Unsecured debts are credit cards and medical bills. Congress adjusts the debt limits every 3 years and additional requirements apply. One of the advantages of Chapter 13, over Chapter 7 is that delinquent mortgage payments can be cured in Chapter 13.

Anyone considering filing bankruptcy should consult with an attorney on the best possible courses of action. Our firm’s trained professionals can offer wise advice and timely service to help you halt a financial slide before the damage is insurmountable.