How Chapter 13 Works
Chapter 13 Bankruptcy: How Does It Work For Individuals, Couples and BusinessesThere are instances where a person has no other choice regarding their finances than to file for bankruptcy. Of course, before a person can think about filing, they must determine if he/she is eligible to do so and what type of bankruptcy he/she can file. Without seeking legal representation, filing a chapter 11 or chapter 13 online can inform persons if they’re eligible or ineligible for bankruptcy protection. Now, there are fewer requirements for a Chapter 13 filing than there are for a Chapter 7 filing. Of course, there are some limitations to this type of financial crisis.
How Does Chapter 13 Bankruptcy Work
This legal financial form is progressive and defies all common assumptions about the process. In a Chapter 13 bankruptcy, you pay back your creditors. In the past, a person looking to going into bad financial claim situation had to have the assistance of a specialized lawyer to do so. However, today, online filing of bankruptcies can occur. But, any person looking to file for bankruptcy because of their incompetence should seek legal remedy to ensure there are no more mistakes being made.
A Look At Individuals Filing For Chapter 13 Bankruptcy Protection
If a person wants to file for Chapter 13 protection, they must have an income that’s larger enough to afford the monthly payments up to five years based on the repayment plan that is designed before it is granted. For persons looking to file a bankruptcy for a second or more time, there needs to be 180 days between the attempts before one is granted.
Bankruptcy and Married Couples
A married couple can file either as individuals or jointly. Whatever way it is done, the requirements are still the same.
A Look At Debt Limitations
A person’s total debt cannot be more than $336,900 of unsecured debt, which is what creditors cannot claim as the debtor’s property when they’re not paid. Unsecured debts include the following things:
- Cable bills
- Credit cards
- Department store cards
- Internet bills
- Personal loans
- Phone bills
A person’s total debt for secured debt may not exceed $1,010,650. Secured debt is what creditors can claim property to when a debtor does not pay. Secured debts include:
- Car loans
- Home equity lines
The debt limit amounts tend to change from time to time, as it follows the consumer price index. The last time these limits were changed was in 2007. To figure out how much debt you have, you should create a bankruptcy filing list. Each company on the list will need to make proof of the financial emergency claim. If this is not done within 90 days of the meetings, creditors will lose claim to the debts owed.
A Look At Businesses Who Want To File For Bankruptcy Protection
Businesses, as a whole, are ineligible to file for bankruptcy protection. However, if a business is owned by a person who is eligible to file, the business can be included with similar requirements..