bankruptcyBankruptcy is a viable option for anyone who is overwhelmed by debt and needs relief. For individuals, there are two options: Chapter 7 and Chapter 13. Rather than liquidating your assets as in Chapter 7, Chapter 13 allows you to retain your assets and repay your debt manageably.

Before you commit to filing for Chapter 13 bankruptcy, it is important to know and understand all of the facts. Below are some of the most important features of Chapter 13 bankruptcy to discuss with your bankruptcy attorney:


  • Known as “Reorganization bankruptcy”
  • Must qualify for Chapter 13
    • Means test results are positive
    • Have disposable income
    • Fall under the debt limit for both secured and unsecured debt
  • You will propose a payment plan to your creditors
  • Repay debt over a three to five year period
  • Can usually keep all assets
  • Help you pay arrearages on your mortgage
  • May be able to lower car payment
  • Can pay back taxes and support obligations
  • Stop foreclosure
  • Plan would give unsecured creditors at least as much as they would receive in a Chapter 7 filing
  • Creditors must agree to the proposed plan

When you are facing an avalanche of debt and need help, filing for bankruptcy may be your best option. Consult with an experienced bankruptcy attorney, such as those at The Law Office of Janet Resetar & Associates or The Southwest Bankruptcy Center to discuss all of your options and decide if Chapter 13 bankruptcy is right for you.