Chapter 13 bankruptcy, also called “reorganization” or “wage earner’s” bankruptcy, requires debtors to restructure their debts and create a three- to five-year repayment plan. Under this bankruptcy option, debtors must use their future income to pay off creditors partially or in full. The arrangement allows debtors to extend the payment period on certain types of debt and retain all of their assets. It is the second most common form of personal bankruptcy after Chapter 7, or “liquidation” bankruptcy, which is a much swifter process compared with the multi-year timeframe of Chapter 13.
In this comprehensive guide on Chapter 13 bankruptcy, you will learn how the process works, who is eligible, how much it costs and more. At the end of the guide, you will also find advice from bankruptcy experts on ensuring a smooth and successful Chapter 13 bankruptcy.