After a job loss, medical emergency, or another financial disaster, you might fall far behind on your debts, with no way to catch up. For borrowers with the means to pay back their past due accounts, a chapter 13 bankruptcy may be the key to getting your finances on track. Below are some answers you might have about filing chapter 13 bankruptcy to restructure your debts.

FAQ About Chapter 13 Bankruptcy

What debts can be included in a chapter 13 bankruptcy?

Chapter 13 bankruptcy is designed to let borrowers make up arrears on secured debts like mortgages and auto loans. Your payment plan must also include priority debts, such as most taxes, child support, and fines owed to the government.

What about unsecured debts?

Like chapter 7, chapter 13 allows you to discharge most unsecured debts, such as credit cards, personal loans, and charge accounts. However, your creditors must receive at least as much as they would have if you surrendered assets in a chapter 7 bankruptcy.

Will I have to give up any belongings?

Because chapter 13 involves paying back the majority of your obligations, you won’t be required to give up any of your belongings. This makes chapter 13 popular with those who have significant investments, art collections, and other valuable belongings.

How much will my payments be?

To qualify for a chapter 13 bankruptcy, you’ll have to show that you can afford to pay back your debts within three to five years. In general, the court expects borrowers to put all of their disposable income toward their bankruptcy payments.

If you’re in a difficult financial situation, a skilled bankruptcy attorney can help identify your legal options and guide you through the process to achieve the best possible outcome. For over 25 years, William C. Rieth has been helping borrowers throughout Monroe County, NY, to reclaim their lives from debt and put themselves back on solid ground. Visit their website to see how he can help with your chapter 13 bankruptcy, or call (585) 232-6520 to schedule your initial consultation today.