Chapter 13 Bankruptcy Attorney

A Chapter 13 bankruptcy is reserved for individuals or small proprietary businesses, and it helps debtors to eliminate their costs by creating a comprehensive repayment plan. While a Chapter 7 bankruptcy requires that the filer liquidate assets, a Chapter 13 bankruptcy allows the debtor to organize all costs into a prepayment plan that can be paid off steadily, month-by-month for a set amount of years (usually three).

Depending on your specific financial situation, you may be required to pay anywhere from 0% to 100% of the debt back. The large benefit of a Chapter 13 bankruptcy repayment plan is that it does not include interest. All debtors are given a 0% interest rate in this situation.

How a Chapter 13 Bankruptcy Works

In a Chapter 13 bankruptcy, clients are required to file all the necessary paperwork with the court, where the case will be reviewed and a meeting of creditors held. Filers are also required to attend counseling by an agency that is approved by the United States Trustee’s Office. After all necessary work and preparation are taken care of, the judge will issue a repayment plan. Bankruptcy filers must stay consistent and pay this plan faithfully if they hope to acquire a debt-free lifestyle.

Some of the debts you will need to repay are called “priority debts”, and it is mandatory that these debts are paid in full. You will also have to pay regular payments on some secured debts such as car loans or mortgages. If you have leftover disposable income for the month, then you may need to repay some unsecured debts, like medical bills or credit card expenses. You may not have to repay these costs in full, but it is best to prepare for this.

Are you eligible for a Chapter 13 bankruptcy?

Not all clients are eligible for a Chapter 13 bankruptcy. Chapter 13s require you to use your income to repay some or all of your debt, so you will need to prove to the court that you have a steady income source that you can use for this purpose. Also, you may not be able to file for a Chapter 13 bankruptcy if your total debt burden is too high. Your secured debts cannot be more than $1,149,525, and your unsecured debts cannot be more than $383,175. If your debts exceed these thresholds, you may want to consider a Chapter 7 bankruptcy instead.

If you are interested in seeking a Chapter 13 bankruptcy, don’t hesitate to contact Bryan Diaz Law,! Our accomplished lawyers have almost 15 years of experience and will do whatever possible to assist you in seeking financial freedom. Hire a team that will offer friendly and attentive service to you while being aggressive when dealing with your creditors!