Chapter 13 Bankruptcy

The specialty of this chapter is that the court will offer the person to run the renovation of business according to the court-approved plan.

The disadvantage of Chapter 13 is that the person without the stable income of the defined level just cannot file for this kind of bankruptcy.

The usual plan to pay off the debt under the Chapter 13 is created for about 3 to 5 years. It’s proposed by debtor to the creditors and if they agree the plan comes to action. It obtains the list of advantages and disadvantages.

The visible disadvantage is that the mark in your credit report will stay for 10 years. Still this doesn’t mean you will not have the opportunity to obtain the new credit. The credit for Auto will be accessible after 1 year, the new mortgage loan in 2 years and most of other loans in 3 years.

The advantage is that the company will go on working in case of bankruptcy so that it will get the opportunity to pay back the debt.

The special feature of the Chapter 13 bankruptcy is that the plan is relying on time more than on the sum of monthly payments. This means that if you’re filing for the Chapter 13 and have the income below the medium in your state, you will most likely get the 3 year plan, which means you will be paying off the fixed monthly sum for three years only. It’s obvious that the shorter the period is the less you pay in total.

All you shall do is to pay monthly to your trustee, who will spread the sum in defined percent to each single creditor. This is the perfect benefit for you since you will not have to tile the money between the people and organizations you owe to.

People tend to file for the Chapter 13 in case they have too high income to opt for the Chapter 7. They also do it to keep some assets like their home or car.

To file for the Chapter 13 you must have the debt no more than $360,475 and the secured debts no more than $1,081,400. If the person obtains the incorporated business, he can also seek for filing the named chapter instead of Chapter 11 meant for businessmen.

If your bankruptcy was dismissed in let then 180 days before the case, you’re not allowed to file for Chapter 13. This can happen in two main cases:

  • If you didn’t appear in the court;
  • If you cancelled the bankruptcy case when the creditors tried to repossess your valuable property.

The cost of filing for Chapter 13 bankruptcy is $271. This consists of $235 for the filing fee and $39 for the fee taken as the administrative one. The costs shall be paid within 120 days after you file, or your case will be dismissed.

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Consolidebt is a debt relief referral company, which helps to pay off your debts in 12 - 36 months, in most cases. We will work with you, step by step, to simplify your monthly commitments, consolidate your monthly payments into one affordable monthly payment (on the date of your choice), and, depeding on the program, either disperse to your creditors on your behalf or work with you to settle your debts.