Chapter 13 bankruptcy is what?
While filing for bankruptcy, there are several codes, which an individual can file under. Chapter 13 Bankruptcy is one such, which allows the debtor to keep property and pay the debt off over time.
The debt is usually paid over a three to five year period. Chapter 13 Bankruptcy is usually chosen by those who have a regular income and who do not wish to deal with the new laws of chapter 7 bankruptcy codes.
Also known as the wage earners plan, chapter 13 bankruptcy enable debtors to pay off part of the debt they have incurred.
While it is not as good as being able to work something out with your creditors and arrange payments individually or through a debt consolidator, it does show some financial responsibility and the debtor’s willingness to make up for their mistakes.
Chapter 13 bankruptcy act as a sort of consolidation loan in itself. Because the debtor is making payments on the owed monies, it does not have such a bad impact on the credit reports. But the individual does not have direct contact with the creditors and payments are distributed amongst them.
To be eligible for the Chapter 13 bankruptcy an individual, even if self-employed must have an unsecured debt of under $307,675 and secured debts must be under $922,975.
No debtor may file for chapter 13 bankruptcy, or any bankruptcy chapter during the preceding 180 days of a previous bankruptcy petition will be dismissed.
There are fees that must be paid also when filing for chapter 13 bankruptcy.
The courts charge a $235 case filing fee and a $39 miscellaneous administrative fee. These fees must be paid when filing unless with the courts permission, it can be paid in installments.
..end of chapter 13 bankruptcy..
