Chapter 13 is an alternative to Chapter 7, and is designed for people with a regular income, who want to pay off their debts, but need a certain amount of time to do so. In Chapter 13, debtors repay their creditors either in full or in part, over a period of three to five years.  A Chapter 13 financial reorganization plan can accomplish the following:

  • Stops foreclosure  
  • Consolidates your bills
  • Lowers your total monthly payments to an affordable level
  • Stops the interest on most of the debts
  • Allows you time to repay your creditors

A Chapter 13 bankruptcy offers flexibility. It is a comprehensive debt reorganization and debt restructuring that results in an affordable monthly payment.

A Chapter 13 bankruptcy requires that you have some source of regular and reliable income, and it’s ideal for people in these situations:

  • You’re behind on your mortgage – the plan will help you get caught up
  • Your second mortgage that is underwater – the second mortgage can be removed entirely!
  • You have unpaid property taxes – the plan will help you get caught up in affordable monthly payments
  • You have unpaid back income taxes – you can pay back the IRS over time at zero interest
  • You’re behind on your car payment – the plan can lower your interest rate and stretch out the loan to lower your payment
  • You have regular income, but you simply cannot meet all of your obligations every month – the plan can help you budget
  • You have assets you want to protect – a Chapter 13 bankruptcy will allow you to keep your assets and pay back your creditors over time.
  • You have certain kinds of debt that are not dischargeable in a Chapter 7 – some kinds of debt, such as civil infraction traffic tickets, are not dischargeable in a Chapter 7 bankruptcy but are dischargeable in a Chapter 13 bankruptcy

In a Chapter 13 bankruptcy, you will still enjoy:

  • Automatic stay from your creditors the entire time you are in your plan
  • Immediate stops to foreclosures, garnishments, and repossessions when your case is filed

A bankruptcy attorney can review your income, assets, and debts and help you determine whether a Chapter 13 bankruptcy might be right for you. 

To set up an appointment with an experienced bankruptcy lawyer, contact us or call us at 732-449-2884. We are available to meet with you any day of the week. Initial consultations are always free.