Chapter 13 Bankruptcy

Chapter 13 bankruptcy is for individuals who want to do a reorganization of finances. If one files for chapter 13 they are expected to pay all their debts over 3-5 years. A plan is devised and written. A person has to begin paying the debt with 45 days of the case being started. The debtor gets to keep his property.

This version of bankruptcy will stay on a person`s record for 7 years. You are also not allowed to obtain any other forms of credit during this time with the court giving permission.

The plan is a detailed document that lays out the treatment of debts, assets, liens and other liabilities. The plan has certain criteria. The creditor must receive at least the amount that they would get had the debtor filed for chapter 7. Also the debtor must give all disposable income to the plan for at least 3 years.