Through the use of a Chapter 13 bankruptcy lawyer, Chapter 13 bankruptcy basically allows the consumer/debtor to retain their home and automobiles and to repay a part of their debt, at a low interest or interest free, over several years after which the bankruptcy will be discharged. Declaring Chapter 13 bankruptcy allows a consumer the chance to repay some or all of their debts over a period of no more than five years. Whereas Chapter 7 bankruptcy compels the bankruptcy court trustee to sell the consumer/debtor’s non-exempted assets in order to repay creditors, a chapter 13 bankruptcy allows the consumer/debtor to restructure their debt through their bankruptcy attorneys, and to make one affordable monthly payment based upon their income. The consumer/debtor will need to demonstrate to the bankruptcy court their ability to make payments and their regular income.

Bankruptcy Process: Chapter 13 Information; How to File Chapter 13 bankruptcy

Because Chapter 13 bankruptcy is basically a US Federal Government debt consolidation program, the consumer/debtor is allowed to keep all of their property. After all, the consumer/debtor is basically offering to pay back up to all that is due, based upon their income.

• A written plan will be created for the interest-free repayment to the creditors by the Chapter 13 bankruptcy lawyer

• The plan outlines all of the payments that will be made and the length of the plan, which can be up to five years

• The Chapter 13 bankruptcy repayment has to start within 45 days after the bankruptcy filing

• If, during the course of your Chapter 13 bankruptcy, something occurs to impact your ability to keep up with your bankruptcy repayments, one of your bankruptcy attorneys will prepare a new repayment plan to reflect your current ability to repay your creditors

One benefit that Chapter 13 bankruptcy offers that Chapter 7 bankruptcy does not is the full discharge option, which is not available in a Chapter 7 bankruptcy filing. A debtor/consumer will be given a full bankruptcy plan discharge after the complete their entire payment plan, which in the longest case scenario, is up to five years. Another benefit to choosing a Chapter 13 bankruptcy plan is that the consumer’s repayment plan can be created so long as the bankruptcy court approves of it, even if the creditor does not.