The decision to file for bankruptcy is a serious one and presents debtors with numerous potential complications. However, if you conclude that bankruptcy is the best option given your financial circumstances, filing a Chapter 13 Bankruptcy may be in your best interest. It is important to note that Chapter 13 Bankruptcy protection may also protect your home from foreclosure.

With the official title of “Adjustment of Debts of an Individual with Regular Income,” Chapter 13 Bankruptcy’s design is better suited for debtors who have the minimal means to pay back at least a portion of their debts. Under Chapter 13 Bankruptcy, a debtor must be willing to create a plan to repay creditors. The court then has the ability to deny or approve the plan based on guidelines that include the plan’s relevance, feasibility, etc.

Chapter 13 Bankruptcy may work better for people who want to adjust their debt as opposed to being immediately released from personal liability for select dischargeable debts. Unlike Chapter 7 Bankruptcy protection, which can discharge your debts within a relatively short period, a Chapter 13 Bankruptcy does not grant an immediate debt discharge. This is one of several differences between a Chapter 13 and a Chapter 7 Bankruptcy.

Another significant difference is that the debtor is normally allowed to remain in possession of their estate’s property – including their home – after they file a Chapter 13 Bankruptcy. However, this depends on several important factors, including the debtor’s ability to create a repayment plan, and their capacity to make payments. These payments are based on the debtor’s expected income over the length of the repayment plan (usually [5] five years), and will be made through the court appointed trustee.

At LaBovick Law Group, our attorneys and legal professionals are devoted to assisting you in working through this complicated area of law. For a free assessment of your Chapter 13 Bankruptcy matter, please fill out the Contact Us form to the right. Or, please call us at 1.888.777.3884 now to discuss your matter with a Florida bankruptcy attorney.