Chapter 13 Bankruptcy Code
A San Francisco Bankruptcy Attorney discusses Chapter 13 of the Bankruptcy Code
Chapter 13 allows a debtor to keep property and repay the debts over a period of time through an approved payment plan. The chapter 13 bankruptcy code gives the debtor either a three or five year option for repayment. A chapter 13 bankruptcy code plan is also known as the “wage earner’s plan” as it is appropriate for individuals who have a steady stream of income. The chapter 13 bankruptcy code plan offers several advantages over a Chapter 7 liquidation. Chapter 13 bankruptcy code allows individuals to reschedule secured debts and extend repayment over the life of the plan. The chapter 13 bankruptcy code also allows for debtors to treat the repayment like a loan consolidation, where all the payments for the debts are made to the chapter 13 bankruptcy code trustee.
In order to be eligible for a chapter 13 bankruptcy code plan, the debtor must not have unsecured debts in excess of $360,475 and secured debts in excess of $1,081,400 (these limits are re-evaluated periodically). In addition, the debtor is required to have a steady stream of income, either from a profession or other constant source. Plans under a chapter 13 bankruptcy code petition must not rely on speculative income as a means to repay the plan.
After the debtor files the chapter 13 bankruptcy code petition, a repayment plan must be submitted to the court for approval. The plan is generally either submitted when the chapter 13 bankruptcy code petition is filed or within 15 days after the petition filing. The plan must identify how the debtor will repay the priority claims (taxes, bankruptcy costs, etc); secured claims (those items secured by collateral), and any unsecured claims.
If the debtor wishes to retain the property, payment to the secured creditors must at least equal the value of the collateral. Additionally, the chapter 13 bankruptcy code states that vehicles purchased within 910 days of filing are required to be paid off for the loan amount, not the value of the vehicle. Unsecured claims do not need to be paid in full so long as the plan provides that the debtor will pay all projected disposable income over the life of the plan. Unsecured creditors under the chapter 13 bankruptcy code must receive at least as much as they would have under a chapter 7 liquidation.
The debtor receives discharge the chapter 13 bankruptcy code upon completion of all payments. Creditors provided for under the chapter 13 bankruptcy code plan may not initiate action against the debtor to collect on discharged obligations. Non-dischargeable debts, such as alimony, certain taxes, and educational loans), are still the responsibility of the debtor after a chapter 13 bankruptcy code discharge.
If you have questions regarding bankruptcy in San Francisco or bankruptcy in the greater Bay Area please contact our San Francisco Bankruptcy Attorneys at (415) 946-8882 for a free consultation or visit www.bkanswers.com and we can connect you with one of our experienced San Francisco Bankruptcy Attorneys. After you have spoken with one of our Bay Area bankruptcy attorneys, we can schedule you for a free face to face appointment in an office location nearest you. Our team of Bankruptcy Lawyers, Bankruptcy Customer Care Specialists and Bankuptcy staff supporting San Francisco and Bay Area consumers in debt can assist you with all aspects of your bankruptcy or bankruptcy litigation case. If you have questions about filing a Chapter 7 bankruptcy, a Chapter 11 bankruptcy, a Chapter 13 bankruptcy, or would like to learn more about bankruptcy litigation, legal debt settlement, mortgage modification, lien stripping, cram down, stopping a foreclosure, wage garnishment, asset protection, discharging a debt, etc. we can help! We have bankruptcy attorneys located throughout California and Oregon who can assist you with all of your debt resolution questions. Please feel free to complete our free online bankruptcy evaluation and we can quickly determine if you are a qualified candidate for bankruptcy. We look forward to hearing from you, San Francisco Bay Area!
