Over 50 Years Of Experience

What you need to know about Chapter 13 bankruptcy

On Behalf of | Dec 31, 2020 | Bankruptcy |

The world is currently dramatically adapting to new situations such as health crises, economic changes and shifts in political power. However, there is one aspect that has not changed in most Americans’ lives: money. Now more than ever, U.S. residents experience financial struggles and must adapt how to approach their budgets. And many of those residents will rely on bankruptcy claims to revitalize their financial future.

Filing for bankruptcy often is associated with a negative connotation. Yet it is an effective process, especially with the help of a bankruptcy law attorney.

A popular bankruptcy option, Chapter 13, requires a debtor work to go through a means test to determine their best course of action for debt relief. Then, individuals may consolidate their debt and reorganize it to aid in their ability to pay back what they owe.

The benefits behind Chapter 13 bankruptcy

There are many advantages to filing bankruptcy, and one key benefit of a Chapter 13 bankruptcy is the ability to allow the individual to set up a repayment plan and not to sell off assets to satisfy a debt. It is an excellent option for anyone who wants to retain their home or any significant personal possessions.

However, Chapter 13 applicants have to meet specific eligibility criteria to qualify, which includes the following:

  • You cannot be a business entity (e.g., L.L.C., corporation).
  • You cannot have gone through a bankruptcy in the last four years.
  • You must meet a credit counseling requirement and have relatively low debt (both secured and unsecured).
  • Your prior taxes must have been filed.
  • You must have sufficient income to repay the debt.

Most individuals may meet these qualifications, but to ensure you do, our qualified bankruptcy attorneys are available to aid you in the application process.