Chapter 13 — Consumer Reorganization

Although an adequate summary of Chapter 13 is not possible on this brief web page, in Chapter 13, we will prepare a "Chapter 13 Plan" by which you will pay part (or maybe even all) of some or all of your debts. Payments would be made through the plan to the creditors to be paid. Both the monthly payment and the total amount paid through the plan are typically calculated based upon what you can afford, not necessarily based on what you owe. Plans typically run from three to five years.

Chapter 13 bankruptcies are frequently used by debtors who are trying to save a house that is in foreclosure or restructure debts on cars or other secured debt. Chapter 13 bankruptcies are also sometimes required for debtors who have a higher than average household income.

After completing the payments under your plan, most debts are discharged, but there are exceptions including for domestic support obligations, most student loans, certain taxes, most criminal fines and restitution obligations, and certain debts for acts that caused death or personal injury.

It is vitally important that you not do any "pre-bankruptcy planning" without obtaining the advice of a competent bankruptcy attorney. Any decision you make where you're thinking that it is a good thing to do before bankruptcy should set off alarm bells. Giving your T-bird to your brother-in-law so the bankruptcy judge doesn't know about it is a good way to not only lose all benefit of your bankruptcy but possibly even to find yourself in prison. Don't do it.

How Much Does It Cost?

I typically charge a base fee of $2300 to $3200 for ordinary consumer bankruptcies under Chapter 13. There is also a filing fee of $313 that must be paid to the Bankruptcy Court. In most Chapter 13 bankruptcies, some or all of these expenses can be paid through your Chapter 13 plan.

A copy of my ordinary fee agreement is here.