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An Overview Of Chapter 13 Bankruptcy In Minnesota

Chapter 13 Bankruptcy (also known as a 'wage earner's bankruptcy') is a legal proceeding under the Bankruptcy Code which helps honest people repay a portion of their debts and receive a discharge of other debts. A person who is eligible for chapter 13 bankruptcy typically proposed a 36 to 60 month Chapter 13 Plan to manage their debts, catch up on arrears, and discharge remaining debts once all of the payments have been made.

Some people are required to file chapter 13 over chapter 7 because they make too much income or have too high of disposable income. Others file because a chapter 13 bankruptcy is especially useful for managing arrears (late payments) on secured debts, such as a mortgage or car loan, and tax debts. In some cases, a chapter 13 bankruptcy can even be used to lien strip a second mortgage from your home or cram down the amount that you would pay on your vehicle to its fair market value.

Upon filing, a chapter 13 can immediately stop garnishments, delay or prevent foreclosures, stop repossessions, restore or prevent termination of utility service, and stop creditor harassment just like a chapter 7 bankruptcy. But in addition, it also protects co-debtors better than a chapter 7 bankruptcy.

The Minnesota bankruptcy attorneys at Weber Law Group, P.A. can help you file for chapter 13 bankruptcy protection and get a fresh start. Please contact us or use our online scheduler to setup a free consultation, or submit your information for review and we will contact you.

To read about whether you qualify to file a 13 bankruptcy, click the 'Next Article' button below.


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