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How Does Chapter 13 Work?

Posted by Chris Peterson | Aug 01, 2014 | 0 Comments

How Does Chapter 13 Work?

How Does Chapter 13 WorkThere are six different types of bankruptcy, but only two are generally applicable to the average applicant. Applying for bankruptcy has both advantages and disadvantages, and a person should consider the matter very carefully before deciding to file. A College Station Bankruptcy Attorney can help you determine whether bankruptcy is your best option, and if so, which type to file.

What Is Chapter 13?

Referred to as “Wage Earner's Adjustment of Debts,” a Chapter 13 bankruptcy does not liquidate debts; rather, it restructures existing debt and provides for a payment plan that lasts for several years. Your College Station Bankruptcy Attorney will tell you that you will not be eligible for a Chapter 7 Liquidation if your income exceeds the state median.

How Does Chapter 13 Work?

Your first course of action is to discuss your options with a bankruptcy attorney. While it is not legally required that you have legal representation, you will find that the process of bankruptcy is complex enough that it is in your best interests.

You then need to complete a credit counseling class within 180 days before filing for bankruptcy protection. You will then draw up a complete accounting of your assets and liabilities, and present this to the court 14 days before filing. A hearing will be scheduled at this point, during which the judge will decide upon the repayment plan. This plan will last from 3 to 5 years, after which you will be debt-free.

It is important to note that not all debts can be restructured. Certain taxes, child support, and student loans are not covered in bankruptcies.

Call a College Station Bankruptcy Attorney for Assistance with Your Bankruptcy

A bankruptcy attorney can take the guesswork out of filing and make sure that you provide the court with all the necessary materials and follow all procedures properly. Call Peterson Law Group today at 979-703-7014 or 936-337-4681.

About the Author

Chris Peterson

Chris Peterson is the owner of Peterson Law Group. He practices primarily in the areas of wills, trusts and estate planning; probate and trust administration; elder law; and business law. Chris is also the owner of Brazos 1031 Exchange Company.


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