There are certain options a debtor has when it comes to filing for bankruptcy, but it all comes down to your particular circumstances and what you qualify for. For instance, Chapter 13 bankruptcy is one way a debtor who is unable to meet the demands of their creditors can work to repay them back. Although filing for bankruptcy is taking a rather large leap, it benefits many who have gotten caught up in financial instability and can’t seem to find their way out of it.
What is Chapter 13 Bankruptcy?
Chapter 13 bankruptcy, which is also recognized as a wage earner’s plan, helps individuals with a regular income formulate a plan to repay back all or a portion of their debts. With this option, the debtor is able to propose a repayment plan that involves them making installments to their creditors over a three or five-year period.
Here are the stipulations based on information provided by the United States Courts:
- If your monthly income is less than the applicable state median, you can expect to pay back your debt over the course of a three-year period. The only way you might qualify for a different time length to pay back is if the court approves it.
- If your monthly income is greater than the applicable state median, your repayment plan is usually for a five-year timeframe. According to state statute 11 U.S.C §1322(d), a debtor will not have a repayment plan for more than five years.
Do I Qualify to File for Chapter 13 Bankruptcy?
Those who qualify for a chapter 13 bankruptcy include:
- Any person or unincorporated business who has unsecured debts that are less than $394,725.
- You must have secured debts that are less than $1,184,200.
- A self-employed individual who meets the unsecured and secured debt requirement.
It is also important to take note of the fact that these amounts are adjusted periodically as they reflect any changes made to the consumer price index.
One thing you need to be mindful of if you are considering filing for any type of bankruptcy is that not just anyone can declare it. Filing for bankruptcy is a big deal as you are asking to either wipe your slate clean from the financial burdens you have acquired or are requesting a new way to pay back what you owe disregarding the initial agreement you made. The best way to learn if declaring bankruptcy is right for you is to speak with a bankruptcy attorney in Pennsylvania who has all the necessary experience and knowledge to inform you on what you need to know.
Have Questions Regarding Filing for Bankruptcy in the State of Pennsylvania?
Whether you have questions, concerns, or simply want to begin the process of filing for bankruptcy, we have a team of agents ready to find you the best Pennsylvania bankruptcy lawyer in the field. Regardless of where you are located, we will work with you to find a professional who is practicing in a nearby area and is qualified to provide you with legal services.
Give USAttorneys.com a call today and let us connect you with a local bankruptcy lawyer now so any uncertainties you may have can be addressed as soon as possible.