Types of Bankruptcy: Chapter 13
There are several different chapters in the United States Bankruptcy code, each meant to provide protection under various different circumstances. For individuals, the two most common forms of bankruptcy are chapters 7 and 13. Chapter 7 is a liquidation bankruptcy, in which repossessed property is sold to cover your debts. Chapter 13, on the other hand, is a restructuring bankruptcy, in which you are given a set time period during which you can pay back your debts without collection agencies constantly leaning over your shoulder.
Unlike Chapter 7, you cannot be forced into Chapter 13 bankruptcy. Additionally, with the Bankruptcy Abuse Prevention and Consumer Protection Act (BAPCPA), Chapter 7 has become somewhat harder to file for, with Chapter 13 being more common as a result. Chapter 13 requires a fair amount of disposable income, though, since you will need to be able to pay off your debt from your income. Lastly, Chapter 13 can only be filed for if you have less than $336,900 in unsecured debts and less than $1,010,650 in secured debts.
Under Chapter 13 bankruptcy, you must present the court with a plan for repaying your debts over a period of between three and five years. You have 30 to 45 days to begin the payments. If you have the income to afford a Chapter 13 bankruptcy, it may be the best option as it provides a greater degree of freedom than Chapter 7.
If you are considering filing for bankruptcy, contact the Milwaukee bankruptcy lawyers of the DeLadurantey Law Office, LLC, by calling 414-377-0518.