How Does Filing Chapter 13 Bankruptcy Work
This chapter isn t available to companies meaning that only an individual can file for chapter 13 bankruptcy.
How does filing chapter 13 bankruptcy work. When new bankruptcy legislation was enacted several years ago part of the law set guidelines about who could file chapter 7 bankruptcy and who had to file chapter 13. However business related debts that you re personally responsible for will be part of your plan and therefore from a practical standpoint a sole proprietorship might be able to benefit from this chapter. When you file bankruptcy as an individual your two primary choices are chapter 7 and chapter 13. Also anyone seeking bankruptcy protection must undergo credit counseling from an approved agency within 180 days of filing a petition.
This is particularly true if you ve got a lot of valuable assets. Once you qualify for chapter 13 you have to work. Because chapter 13 is messier and more expensive first see whether you can file under chapter 7. Chapter 13 petitioners must stipulate that they haven t had a bankruptcy petition dismissed in the 180 days before filing due to their unwillingness to appear in court.
If you re filing for chapter 13 bankruptcy a chapter 13 repayment plan could be the legal tool that puts you on a clear path toward getting out of debt.