Chapter 13 bankruptcy

Chapter 13 is designed for individuals with regular income (typically referred to as a “wage earner”) who would like to pay all or part of their debt over a period of time.  You must meet specific requirements set out in the Bankruptcy Code to qualify.

Under a Chapter 13 bankruptcy you must file a plan with the court to repay your creditors all or part of the money you owe them, using your future earnings.   Depending on your circumstances these plans can either be 3 or 5 year plans and subject to court approval.   Many of the same type of debts eliminated in a Chapter 7 are eliminated in a Chapter 13.

A big advantage available in Chapter 13 is the ability to cure mortgage payment arrears (missed payments).    If you are behind on one or more mortgage payments you may be able to bring your loan current through a Chapter 13 plan.  Doing so can prevent foreclosure of your property for not making payments.

A Chapter 13 plan can also address taxes owed to your state and the federal government.  If you owe “back taxes’ a plan can provide for payment over a 3 to 5 year time period in order to allow you time to catch up.  During the duration of the plan there will be no collection action taken (i.e. wage garnishment, levy on accounts, etc….) so you and your family can have peace of mind while you resolve this issue.

There may be other benefits in a Chapter 13 and my office would be happy to discuss your particular situation.  Please call 805-739-9201 or email my office at