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Chapter 13

Excessive debt can be a heavy burden. It can even feel like it’s taking over your life. If you’re struggling with debts, bill collectors and shaky finances, you might be curious about bankruptcy. Can it help you reach the light at the end of the tunnel?

Most individuals who file for bankruptcy file either Chapter 7 or Chapter 13. Chapter 7 bankruptcy is often called straight bankruptcy or liquidation. This is the fastest, easiest method of bankruptcy but is not available to all filers. With Chapter 13 bankruptcy, you will be on an affordable monthly payment plan to take care of your debts over a 3-5 year period of time.

How Does Chapter 13 Work?

If you are eligible for a Chapter 13 bankruptcy, you’ll begin by gathering and completing a variety of documentation to support your petition. These include:

  • Proof of your income,
  • Tax returns,
  • A list of your creditors, A
  • list of your assets,
  • and other documents


You will also need to complete an approved credit counseling course within the 6 months prior to filing your case. If you completed a debt repayment plan during the course, you’ll need to file this with the court as well.

Along with the statement of financial affairs, schedules and the official bankruptcy forms, you will also need to gather and provide:

  • A list of your creditors, the amount you owe, and the nature of the claims
  • Information about your income, including its source, amount and frequency
  • A list of all your property
  • A detailed list of your current monthly expenses, including the cost of utilities, shelter, food, taxes, clothing and other necessary items


Chapter 13 and Foreclosure

Chapter 13 is a way for people to save their home from a foreclosure sale. If you file a Chapter 13 prior to a foreclosure sale, the automatic stay will likely stop the foreclosure sale of your home.

The Trustee

Upon the filing of a Chapter 13 case, a Trustee is assigned to review your petition, schedules, and Chapter 13 plan.  The Trustee also accepts your monthly payments and distributes these payments to your creditors.

Meeting of the Creditors

After your case is filed, you will be required to attend a meeting of creditors and your bankruptcy trustee will ask you questions under oath about your finances, your property, and other factors affecting your bankruptcy. Your First America Law attorney will represent you at this meeting of creditors.

The Hearing

After your Meeting of Creditors there is a Confirmation Hearing where the judge formally approves your Chapter 13 Plan.

The Repayment Plan

The repayment plan is a detailed plan that outlines how your debts are handled. All unsecured creditors must get at least as much as they would have through a Chapter 7 bankruptcy. Over the next three to five years, you will continue to make payments, which the trustee will disperse to your creditors.

Rebuilding Your Credit After Chapter 13 Bankruptcy

A Chapter 13 bankruptcy will remain on your credit report for up to 10 years. As long as your plan is in effect, you can still qualify for a new mortgage or vehicle loan with the permission of the court. After your debts have been discharged, you will also continue to have access to credit although you may find that fees and interest rates are higher than before.

Chapter 13 and repossession.

If your vehicle has been repossessed, a Chapter 13 filing can get your car back provided you file prior to the vehicle being sold at auction.

Chapter 13 and Tickets.

If your driver’s license is suspended because of parking tickets, filing a Chapter 13 can get your driver’s license back

Call 1-800-695-7674 Today!

At First America Law, our bankruptcy representatives can help you explore all your options and decide if Chapter 13 bankruptcy is right for you. We will support you every step of the way as you create your petition and develop a repayment plan that will give you the fresh start you need. Call us today at 1-800-695-7674 to schedule your no-obligation consultation.