Northeastern Ohio Chapter 13 Bankruptcy Attorneys
Cleveland - Akron - Canton

What Is Chapter 13 Bankruptcy?

Chapter 13 is a consumer debt reorganization. This allows debtors to restructure payments by combining many debts into their "plan" and paying ONE monthly payment to the Chapter 13 Trustee for all the debts included in the plan. Regular mortgage payments continue to be made directly to the creditor "outside" the plan. Thus, if you have mortgage arrears, the arrears CAN be included in the plan, but the future payments due under the loan must ALSO be made separately. The debtor keeps his property and makes payments to the trustee out of future income to pay all or a portion of his debt over the life of the plan.

When is Filing Chapter 13 Bankruptcy Appropriate?

Chapter 13 is usually appropriate for people who have fallen behind on secured loans (such as cars or houses) and need to catch up before repossession or foreclosure. It may also be appropriate when someone has non-exempt property that cannot be protected in a Chapter 7 bankruptcy, or if someone has sufficient disposable income to pay a significant portion of their debt over time. Many factors go into determining if a debtor qualifies for or should pursue a Chapter 13 filing. You should consult a Ohio chapter 13 bankruptcy attorney before deciding if this avenue is right for you.

In Chapter 13, even though a debtor keeps his property, Exempt Property are still used to determine if a "plan" complies with the Bankruptcy Code. Creditors are entitled to receive at least as much through the Chapter 13 plan as they would have under a Chapter 7 liquidation. Hence, a debtor's payments into a Chapter 13 plan must provide at least as much to creditors as they would have received through liquidation in Chapter 7 of non-exempt property.

Debra Booher & Associates is one of the leading consumer bankruptcy law firms in northeastern Ohio. Bankrutpcy lawyers at our firm file more than 2,000 bankruptcy cases per year for clients throughout northeastern Ohio, including Akron, Canton, Cleveland, Medina, and Kent / Ravenna.