A Chapter 13 payment plan is designed to help you keep your property but restructure your debt payments in a way that works with your monthly income and expenses. Your debts get separated into 3 different categories, one of which is unsecured debt: credit cards, medical bills, payday loans, personal loans, business lines of credit, and nearly everything else that does not attach to property. The big question is most 13s is: how much, if any, of my unsecured debt will I be required to repay? The answer is determined by someone's overall circumstances but normally relies on how much disposable income that person has after taking care of necessary monthly expenses such as rent, utilities, food, vehicle expenses, etc.
Someone typically files a Chapter 13 instead of a Chapter 7 for one of the following reasons:
- They are in danger of losing property and need to keep it (facing foreclosure or repossession);
- They make too much money to qualify for a 7;
- They would likely lose property they want to retain if they filed a 7.
Chapter 13s can be complicated and it's vital that a case be prepared thoroughly and diligently in order for someone to have the smoothest possible experience and to set themselves up for success during and after the case. Call me or fill out the "Contact our Firm" form on the right hand side of this page so we can get started.