Free Initial Consultations Available : 800-822-1066

Who is eligible for Chapter 13?

It is not unusual for Pennsylvania residents to experience financial problems to the point that they have to consider filing for one form of bankruptcy or another. Understanding which chapter suits their needs is key. Knowing the benefits of one over another can help to make an informed decision. With Chapter 13 bankruptcy, there are certain benefits that it has over other options. For those who are seeking a fresh financial start, filing for Chapter 13 is a strategy to get it.

For people who own a home and would like to prevent foreclosure on the property, Chapter 13 bankruptcy is a way to avoid a liquidation that might come from another bankruptcy chapter. Chapter 13 can stop foreclosure and help with clearing delinquent payments as time passes. The mortgage payments have to be made on time during the Chapter 13. In addition, Chapter 13 will can help to reschedule other secured debts and have them extend for the duration of the Chapter 13. There is also a provision in Chapter 13 that protects third parties who are confronted with liability on the consumer debts the debtor has accrued. Chapter 13 is similar to a consolidation loan with the debtor making payments to a trustee who will then pay the creditors.

Chapter 13 is for anyone. Even those who are running an unincorporated business or are self-employed can file for Chapter 13. The unsecured debts have to be below $383,175. Secured debts have to be below $1,149,525. On a periodic basis, these amounts will be adjusted depending on the consumer price index. Corporations and partnerships cannot file for Chapter 13. Those who are considering filing for Chapter 13 are not allowed to have filed in the previous six months, cannot have had a previous bankruptcy filing dismissed because of a willful failure to appear before the court, or for not complying with orders given by the court. There must also be participation in a credit counseling course in the prior six months.

For those who are experiencing financial problems, Chapter 13 in a way to reduce debt and get back on stronger financial ground while saving one's home. Before moving forward with a filing, it is imperative to have a full grasp on the entire process. Discussing the matter with an attorney experienced in Chapter 13 is wise.

Source: uscourts.gov, "Chapter 13 -- Bankruptcy Basics -- Advantages of Chapter 13; Chapter 13 Eligibility," accessed on Oct. 26, 2016

No Comments

Leave a comment
Comment Information

Lehighton Office

Rapa Law Office, P.C.
141 South 1st Street
Lehighton, PA 18235

Lehighton Law Office Map

Allentown Office

Rapa Law Office, P.C.
609 Hamilton Street, 1st Floor
Allentown, PA 18101

Allentown Law Office Map

Contact Numbers

Phone: 610-377-7730
Toll Free: 800-822-1066
Fax: 610-377-7731
Toll Free: 866-740-6117

Review Us