The loss of a job, unexpected expenses and any other number of factors may result in financial challenges for people in Florida, and throughout the U.S. Those facing these types of issues may choose to file for bankruptcy in order to help them regain control of their finances. However, there are a number of bankruptcy options available, some of which may be better suited for certain situations than others. As such, it can be difficult for people to understand which option right for them. At The Law Offices of George Castrataro, P.A., we often consult with people who are unsure whether Chapter 13 bankruptcy is for them. In this post, we will provide an overview of Chapter 13 bankruptcy.
Often referred to as a wage earner's plan, Chapter 13 bankruptcy involves establishing and implementing a debt repayment plan. This is different than other filing options, which generally discharge debts. By filing for Chapter 13 bankruptcy people with regular incomes develop plans to repay their debts over a period of three to five years, according to the U.S. Courts. With few exceptions, creditors are not permitted to continue collection efforts, or begin new ones, while a Chapter 13 repayment plan is in effect.
In general, individual people may be eligible for Chapter 13 bankruptcy. While those who are self-employed or are operating unincorporated businesses are typically eligible, businesses are not generally eligible for this type of filing. According to the U.S. Courts, in order to qualify, the person filing cannot have unsecured debts that total more than $383,175 or secured debts in excess of $1,149,525. If a person has had a prior filing dismissed because he or she willfully failed to appear in court or comply with the court’s orders within the previous 180 days, he or she may be ineligible for Chapter 13 bankruptcy. Additionally, a person cannot have voluntarily dismissed a prior filing in the preceding 180 days after creditors attempted to recover property that they hold liens on through the courts.
To learn more about the options that may help you to achieve a fresh financial start, please visit our bankruptcy page.