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QR Law Blog
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- Short Sale Paradigm Shift with SB 458
- Bankruptcy Eligibility Evaluation
- Can Bankruptcy Help Short Sale Approval?
- Know Bankruptcy Alternatives Before Short Sale
- Estate Planning in a Depressed Economy
- California State Legislature Passes SB 458
- Short Sale Approval Letter Review By Attorney
Hot Topics
Chapter 13 Bankruptcy
Chapter 13 (called “repayment) involves a repayment plan under which the debtor makes regular payments over time (3-5 years), which are paid to the Chapter 13 trustee and divided among the creditors. The Chapter 13 debtor typically keeps his property. Individuals may file a Chapter 13 bankruptcy petition if they have (a) regular income and (b) unsecured debt less than $360,475 and (c) secured debt less than $1,081,400.
Most Chapter 13 repayment plans pay some but not all of the debt owed to creditors. The amount repaid in Chapter 13 can range from 0% to 100% depending on the debtor’s income, the value of non exempt assets and the make-up of the debt.
Certain debts that cannot be discharged in Chapter 7 can be discharged in Chapter 13. Chapter 13 also provides a mechanism for individuals to prevent foreclosures and repossessions, while catching up on their secured debts and to strip off liens that are really unsecured.
Individual debtors in Chapter 7 get a discharge within 4-6 months of filing the case. Debtors in Chapter 13 can get a discharge upon completion of the repayment plan, which is 3-5 years after approval.
USC Title 11 has other chapters for different types of bankruptcies. These include Chapter 11 (reorganization typically for businesses and individuals with higher debt or income levels), and Chapter 15 (for cross-border insolvencies).
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