While Chapter 7 bankruptcy is an option for individuals with lower incomes, Chapter 13 can be a great option for both low income and high income situations. There are circumstances where you can actually pay less to eliminate your debt in a Chapter 13 if there are car loans involved. If you have any questions about being eligible for Chapter 13 bankruptcy, you are always welcome to give us a call for a consultation. Also, please take a look at some of the information below, which might be able to help you out right away…
Can’t be an incorporated business
Chapter 13 bankruptcy is meant for individuals that are middle and upper-middle class. If your business is incorporated, it does not qualify for Chapter 13 bankruptcy, and may need assistance under Chapter 11 or 7. If your business is not incorporated (a sole proprietorship), then you can file a Chapter 13, but the filing is for both yourself and your business. Also there are many times that you have personal liability due to obligations of your business, incorporated or not, that may make it necessary to seek relief under Chapter 13 while still maintaining your business.
Have not filed a Chapter 7 within 4 years or a Chapter 13 within 2 years
There are many things to consider when you have a previous filing. The main thing to know is that there are few circumstances where we you are not able file some type of bankruptcy if you need immediate relief, despite having filed previously. A free consultation with one of our attorneys can resolve your concerns regarding this issue.
Dependent on debt amounts
There is a maximum amount of debt that an individual can have which can prevent someone from filing a Chapter 13 bankruptcy. These amounts are divided between unsecured debt and secured debt. The unsecured debt of an individual who is seeking Chapter 13 bankruptcy must be below $383,175, while the secured debt must be less than $1,149,525. These amounts are subject to change, due to the consumer price index. There is no minimum amount of debt required.
There are many circumstances where a Chapter 13 is better than a Chapter 7
An experienced attorney can carefully guide you through the decision making process to find out which Chapter is best for you. Ultimately the decision is yours, as long as you qualify for either option, however many times people discover based on their circumstances, a 13 may actually be a better option.