Who Chapter 13 Bankruptcy Is For
Chapter 13 has been coined the “wage earner’s plan” and involves adjusting the debts (rather than discharge/liquidation) of those who earn a regular income. If you don’t want to risk losing your property and you want to attempt to repay your debts over time, Chapter 13 bankruptcy may be right for you.
Chapter 13 is generally intended for:
- Individuals who earn a regular income;
- Individuals who want to develop a plan to repay all or part of their debt;
- Individuals who can commit to repaying creditors over a 3-5 year period;
- Individuals who do not qualify for Chapter 7;
- Individuals who want to save their homes from foreclosure;
- Individuals who want to avoid liquidation of their assets;
- Individuals who want to protect third parties who may also be liable for their debts, such as co-signers;
- Individuals who want to avoid direct contact with creditors;
- Individuals whose unsecured debts to not exceed $383,175 and whose secured debts do not exceed $1,149,525.
Collateral Consequences of Bankruptcy
Before you decide whether bankruptcy is right for you, you may want to familiarize yourself with the collateral consequences, such as what bankruptcy does to your credit and how it could affect your ability to finance a car, take out a business loan, and more.
Bankruptcy can have the following consequences:
- If you file for Chapter 7 bankruptcy, some of your assets will be liquidated. Some Chapter 7 debtors lose their homes if they have a substantial amount of equity that can be used to pay creditors;
- It can impact your credit score for up to seven to ten years, although you can begin to work on improving that score immediately after filing for bankruptcy;
- It could make it more difficult to obtain new lines of credit, or at least limit the amount of credit you can be extended.
When In Doubt, Consult an Attorney.
The best way to determine if bankruptcy is right for you, and which type, is by contacting a bankruptcy lawyer. Attorney Joseph P. Doyle has been doing this for a long time, and can help anyone in the greater Chicago area who is looking for solutions to their debt. For a free consultation, call today (312) 957-8077!
-  http://www.uscourts.gov/services-forms/bankruptcy/bankruptcy-basics/chapter-7-bankruptcy-basics
-  http://www.uscourts.gov/services-forms/bankruptcy/bankruptcy-basics/chapter-11-bankruptcy-basics
-  http://www.uscourts.gov/services-forms/bankruptcy/bankruptcy-basics/chapter-13-bankruptcy-basics