All You Want to Know About Chapter 13 Bankruptcy

When debts have become overwhelming, it may seem like all hope is lost. However, in certain circumstances you may be able to seek relief through bankruptcy. People who have little savings and minimal assets can file for Chapter 7 bankruptcy. This chapter removes qualifying debt in 4 to 6 months without any requirement to repay creditors.


Not everyone can file for a Chapter 7 bankruptcy, so Chapter 13 may be a better option in certain cases. Note that there are specific requirements that you need to know before filing for a Chapter 13 bankruptcy.

Debt limits

Unsecured debts and secure debts should not go beyond specific limits. A “secured debt” gives the right to the lender to take the property if you fail to pay the debt.

On the other hand, the “unsecured debt, comprises a medical, or credit card bill that doesn’t provide this right to the creditor. If the total burden of debt goes too high, then you will be ineligible. However, you may still file for Chapter 7 bankruptcy.

The Benenati Law Firm can help you file a Chapter 13 bankruptcy.

Steady income

At the time of filing a Chapter 13 case, it is required that you show to the law that you are able to meet monthly household obligations as well as pay into a reimbursement plan. If your income is extremely low or unstable, then the court will likely not approve your proposed reimbursement plan.

Not a business

This chapter is not available to businesses. Only individuals can file under Chapter 13 bankruptcy. However, if you are responsible for your business-related debts, then it will be a part of the Chapter 13 bankruptcy plan. This plan is advantageous for people who have a sole proprietorship business.

Filing of Chapter 13 bankruptcy case

Necessary Actions

At the time of filing for the official bankruptcy forms, it is important to pay a bankruptcy filing fee. You will also need to present a certificate that showcases that you have received the necessary credit counseling from a firm approved by the US Trustee’s office.

By undergoing this session, you will come to know whether or not you have adequate income to make payment to your creditors. It is required for you to take another “debtor education” program post-filing for the case.

How much do you need to pay in fees?

To file a Chapter 13 bankruptcy filing case, it is required to pay charges of around $25 to $35 for every course as providers need to provide counseling for either free or at low rates.

The Chapter 13 Repayment Plan

The main part of the Chapter 13 case is a “repayment plan”. You will propose it to the court, as well as creditors. Amongst all other things, this plan has to take account of all your debts. You will either use the court’s local form or official plan on the basis of where you file.

Your creditors, as well as the bankruptcy executor, will get a chance to object to the plan. If you can form modifications to the satisfaction of everyone, the court will confirm your plan at the hearing. You would not need to wait until confirmation of the plan to begin paying monthly payments. Your payments will start after you file a bankruptcy.

Equipped with all this information you can go through along with a reliable and experienced bankruptcy lawyer.