Macco Law Group, LLP

What is chapter 13?

What is chapter 13?

When you realize you have more debt than you can handle, you may consider filing for bankruptcy in New York to find financial relief. There are many different kinds of bankruptcy and depending on your particular situation, chapter 13 may be a good option. 

Filing for chapter 13 bankruptcy may be a good choice if you still have a steady stream of income. According to the United States Courts, chapter 13 allows you to develop a repayment plan. This plan generally provides you with three to five years to pay back your debt, and creditors usually cannot contact you until this time period has expired. If you think this type of bankruptcy might help your family, you generally need to give a petition to your local court system. The court may ask you to provide information about your living expenses and income, as well as supply a list of your assets and creditors. 

In order for your bankruptcy petition to be valid, you typically need to work with a trustee to identify a repayment plan. This trustee may ask many questions about your financial situation. It is important for you to explain your financial affairs honestly because it is usually easier to develop a viable repayment plan when a trustee fully understands your situation.

If you want to file for chapter 13 bankruptcy, you generally need to meet a few requirements. You typically need to attend credit counseling to demonstrate that you understand your situation. Additionally, you may need to meet financial requirements. You may not be able to file for this kind of bankruptcy if you have secured debts amounting to more than $1.1 million and unsecured debts of more than $395,000.

This information is general in nature. It should not be used in place of legal advice.