Photo of attorney Scott Orsini

COVID-19: Orsini Law Group continues to follow precautionary guidelines in response to the COVID-19 pandemic, offering clients the opportunity to meet online, in person or by telephone. 

What are the benefits of a Chapter 13 bankruptcy?
  1. Home
  2.  | 
  3. Bankruptcy & Asset Protection
  4.  | What are the benefits of a Chapter 13 bankruptcy?

What are the benefits of a Chapter 13 bankruptcy?

On Behalf of | Sep 29, 2023 | Bankruptcy & Asset Protection

You might be struggling with debt and wonder if bankruptcy is the right solution for you. However, perhaps you are worried about losing your home or other assets and this is what is preventing you from filing for bankruptcy.

A Chapter 13 bankruptcy might be right for you in this situation. Chapter 7 and Chapter 13 bankruptcies are two of the most common types of bankruptcies filed by Florida residents who are overwhelmed with debt.

A Chapter 7 bankruptcy discharges all your qualifying debts, but part of the Chapter 7 process involves identifying all your assets to see if any could be used to pay your debts. This could put your home in danger of being sold.

In a Chapter 13 bankruptcy, your debts are reorganized into a three to five-year payment plan. If you successfully complete the payment plan, you can typically keep your home or other assets.

Qualifying for Chapter 13 bankruptcy

There are certain requirements you must meet to be eligible for Chapter 13 bankruptcy. One of the biggest requirements is that you must have an income. The reason for this is you must show the bankruptcy court and your creditors that you can make payments under the payment plan.

Another requirement for Chapter 13 bankruptcy is that your total debts must be under certain specified limits. There are different limits for unsecured and secured debts.

Unsecured debts are debts from credit cards, personal loans or any other type of debt without an asset attached to it. Secured debts are debts such as mortgages or car loans.

You might also be forbidden from filing Chapter 13 bankruptcy if you previously filed bankruptcy and it was dismissed within the last 180 days or your debts were discharged with a Chapter 13 bankruptcy within the last two years.

Filing for Chapter 13 bankruptcy

Qualifying for Chapter 13 bankruptcy is just the first step. You must provide certain information and documents to complete a bankruptcy petition. Once the petition is filed, there are other steps involved in the process. It is best to have help when completing each step.