Chapter 13 Bankruptcy: How does it work?

A Quick Review of Chapter 13 Bankruptcy

Chapter 13 bankruptcy is part of the bankruptcy code under which a debtor may repay all or a portion of their debts under the supervision and protection of the bankruptcy court.  During this time, creditors are prohibited from contacting the debtor and the debtor is protected from foreclosure, just as in a Chapter 7.

In a Chapter 13 bankruptcy, the debtor must submit to the court a plan for the repayment of all or a portion of his or her debts. The Chapter 13 Plan must be approved by the court to become effective. If the court approves the plan, most creditors will be prohibited from collecting their claims from the debtor during the course of the case. The debtor must make regular payments to the Chapter 13 Trustee, who collects the money paid by the debtor and disburses it to creditors as stated in the plan. Upon completion of the plan payments, the debtor is released from liability for the remainder of his or her dischargeable debt.

If you would like to discuss Chapter 13 bankruptcy, or your eligibility to file under Chapter 7, call me today to schedule a free in-office or telephone consultation today!  The Ohio Bankruptcy Attorney, David Smith – let me help you get your fresh start for a new tomorrow!