What is Chapter 13 Bankruptcy?
What is Chapter 13, Bankruptcy?
What is Chapter 13?
Chapter 13 is also referred to as the wage earner’s plan. This bankruptcy type allows individuals with regular income to create a repayment plan to pay all or part of their debts. Only self-employed individuals, married couples, or running an unincorporated business are eligible for Chapter 13. For more details about eligibility, contact a bankruptcy attorney in Miami. Under this chapter, it’s expected that debtors pay a significant portion of their debts within 3-5 years.
Understanding Chapter 13
While you can file for Chapter 13 bankruptcy all by yourself, you’ll need the help of a Miami bankruptcy attorney to facilitate a seamless application. Besides offering legal advice, your lawyer will help you decide if Chapter 13 is suitable. Furthermore, the attorney will assist you with filing forms and working with the trustees, creditors, and the judge. To file for Chapter 13 bankruptcy, you need the following:
- A list of all creditors with the amount of money owed
- A list of properties owned
- Information about income amounts and sources
- A detailed list of monthly living expenses, including clothing, shelter, transportation, medicine, and utilities.
How Chapter 13 Bankruptcy Works?
Upon filing your paperwork in court, you’ll receive a notification letter suspending all forms of money collection on your accounts.
Following this, you have to decide on a repayment plan which will be presented in court. Moreover, the plan should be fair and meets legal standards. Based on the plan, you’ll pay the trustee specific amounts monthly or biweekly. The trustee will dispense the payments to the creditors as scheduled. Ensure you adhere strictly to the repayment plan. Failure to do that could lead to the withdrawal of your bankruptcy case.
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