Chapter 13 is a type of reorganization bankruptcy often mistakenly called the repayment Bankruptcy. A reorganization may involve eliminating a second mortgage, pursuing a modification of your home loan through the Mortgage Modification Mediation Program, getting up to date on missed mortgage payments or association fees, and potentially reducing the loan amount on investment property. The duration of a Chapter 13 reorganization, which depends on the debtor’s income, can be either 36 or 60 months.
This is a plan prepared by a legal firm in which the method and amount of repayment of your debts is outlined and proposed. The amount to be repaid is dependent upon your assets, gross income, secured debt, and arrearage owed.
Chapter 13 Bankruptcy is alternatively referred to as a reorganization bankruptcy.
Individuals file for Chapter 13 bankruptcy to gradually settle their debts within a timeframe of three to five years. This method of bankruptcy is favored by individuals who possess non-exempt assets they wish to retain. It is exclusively available to those with a steady income that allows them to cover their essential expenses and still have surplus income to repay their debts.
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