Chapter 13 bankruptcy is designed for an individual debtor who has a regular source of income. It may be preferable to Chapter 7 because it enables the debtor to keep a valuable asset, such as a house, and because it allows the debtor to propose a “plan” to repay creditors over time – usually three to five years. Chapter 13 bankruptcy is also used by consumer debtors who do not qualify for Chapter 7 relief under the means test. At a confirmation hearing, the court either approves or disapproves the debtor’s repayment plan, depending on whether it meets the Bankruptcy Code’s requirements for confirmation.
Chapter 13 is very different from Chapter 7 since the Chapter 13 debtor usually remains in possession of the property of the estate and makes payments to creditors, through the trustee, based on the debtor’s anticipated income over the life of the plan. Unlike Chapter 7 bankruptcy, the debtor does not receive an immediate discharge of debts. The debtor must complete the payments required under the plan before the discharge is received. The debtor is protected from lawsuits, garnishments, and other creditor actions while the plan is in effect.
Our experienced and qualified Chapter 13 Bankruptcy team is here to help. We have a long history of provided proven results through our extensive knowledge. If you have any questions about Chapter 13 Bankruptcy or want to know if it’s the right decision for you, please contact us. It is never too early to explore your options.
Find out about filing Chapter 13 Bankruptcy in Michigan
If you would like more information about filing for chapter 13 bankruptcy please contact us and we can help you determine your best option.