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What to know before filing for Chapter 13

On Behalf of | Apr 21, 2022 | Chapter 13 Bankruptcy

When you file for consumer bankruptcy in Florida, you typically do so through either a Chapter 7 or Chapter 13 format. There are different benefits, drawbacks and eligibility requirements associated with each type. However, if you have concerns about potentially having to surrender your home and other assets and have at least some money available to put toward debts, a Chapter 13 bankruptcy may make the most sense.

Per the U.S. Courts, some people refer to Chapter 13 bankruptcies as “wage earner’s plans” because you need to have a regular income to file for this type of personal bankruptcy. Other important things to know about a Chapter 13 filing are as follows.

Advantages of a Chapter 13 bankruptcy

A common reason some filers prefer to file for Chapter 13 over Chapter 7 is that they have concerns about losing their homes. A Chapter 13 bankruptcy may help you stop foreclosure proceedings against your home. However, for this to happen, you need to stay up-to-date on your mortgage and the other payments you agree to make as part of your payback plan.  Another benefit of this type of filing is that you have no direct personal contact with your creditors. Instead, your bankruptcy trustee handles that side of things.

Eligibility requirements for a Chapter 13 bankruptcy

Your ability to file for Chapter 13 depends on several things. First, you have to have a regular income. Second, you need to have a certain amount of secured and unsecured debts. The amounts yours must fall within change from time to time, so today’s qualifications may prove different than those you might face later on.

It also takes longer for your debts to undergo discharge when you file for Chapter 13 than it would if you filed for Chapter 7.


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