What is a Chapter Thirteen?
The purpose behind Chapter 13 Bankruptcy filing is rehabilitation of the debtor, meaning you are given the opportunity to repay some or all of your debts, but under generally better terms (lower or no interest). Rather than having to liquidate assets to pay off debts, this process is designed to allow the debtor to use future income to pay off creditors. Chapter 13 Bankruptcy is basically an adjustment or reduction of debts for a debtor with regular income. Information on Chapter 13 bankruptcy law of the United States Bankruptcy Code is frequently referred to as a “wage earner” chapter, although it is available to individuals with regular income from any source, not just wages. In order to file Chapter 13 the debtor must be able to pay monthly living expenses and pay the trustee to consolidate the debt. In order to make these payments the debtor must have a consistent source of income, or at least reasonable prospects of future income. Just like in a Chapter 7 Bankruptcy, the individua
