Accumulation of debt is a major problem for people in the United States. There comes a point when it becomes impossible to pay it off. Filing for bankruptcy is a way to deal with large debts. Chapter 13 bankruptcy provides you with the opportunity to restructure your repayment plans and pay off the debt within a period of three to five years. Within that time, you can organize your finances and make alternate arrangements to pay off the debt.
To qualify for Chapter 13 bankruptcy, your earnings must exceed the limit for Chapter 7 bankruptcy. Businesses are not eligible to apply, but if you are an individual or a married couple, you may file for Chapter 13 bankruptcy.
When filing for Chapter 13 bankruptcy, you have to file a petition with a bankruptcy court. Once the proceedings start, you will have the option of selecting a repayment plan for your debt. If your gross income is less than the median income for your state, a 36-month plan is proposed. By contrast, if your gross income is more than the median income for you state, a 60-month plan may be approved for you. A Chapter 13 plan is filed which contains all the details of the loans that have to be repaid, a summary of assets and liabilities owned by the filer, as well as any other relevant information.
Chapter 13 bankruptcy protects you from foreclosure and allows you to keep your assets. It is a great option for people who want a fresh start but want to keep their assets as well. If you are in a similar situation, consider consulting with an attorney who specializes in bankruptcy. The experience of an attorney can be crucial in determining whether your application for Chapter 13 bankruptcy gets approved.