Chapter 13 Bankruptcy
Chapter 13 is for individuals who have regular income, are trying to protect property from repossession or foreclosure, and/or who want to pay something back to their creditors. In a Chapter 13 we work with you to prepare a Plan under which creditors are paid over a 3 to 5 year period with the Bankruptcy Court’s supervision and protection. Chapter 13 cases are used to help catch up on mortgage payments, restructure car payments, and pay delinquent taxes and support obligations. In most case your unsecured creditors are paid a small percentage of what they are owed, sometimes as little as 1%.
A Chapter 13 filing immediately “stays” or stops any creditor action such as foreclosure, garnishment, repossession, seizure, and attempts at collection including phone calls and letters.
The cost to file a Chapter 13 is $380.00.
Chapter 13 is best for individuals who:
- have income and assets they want to keep
- are behind on your mortgage and want to keep the home
- have a wage garnishment
- are behind on your car payment or want to get back a repossessed vehicle
- are behind on federal or state taxes
- are behind on support obligations
A Chapter 13 bankruptcy remains on your credit report for seven years.
Chapter 7 and Chapter 13
The United States Bankruptcy Code permits individuals with financial problems to file for bankruptcy protection under either Chapter 7 or Chapter 13. Both Chapter 7 and Chapter 13 will protect you from your creditors once the case is filed.