Information on Chapter 13 Bankruptcy

Chapter 13 bankruptcy allows higher income debtors with non-exempt assets to pay an affordable amount back to their unsecured creditors and modify some of their secured loans. Chapter 13 will protect your home from foreclosure, car from repossession, wages from garnishment, stops all collection and, depending on your assets and income level, it may allow you to pay only a percentage of what is owed to your unsecured creditors (i.e. credit cards). Even consumers who otherwise qualify for Chapter 7, will elect to file Chapter 13 instead because it allows them to modify their car loans and remove unsecured 2nd or 3rd mortgage from their residence.

In a Chapter 13 bankruptcy, you will repay your debts through monthly payments which are spread out over a 3-5 year period. Your repayment amount is based on your assets, your income, your expenses.

Frequently Asked Questions About Chapter 13 Bankruptcy

I have an overwhelming amount of debt. I know my income is too high to qualify for Chapter 7 bankruptcy. Is my income too high to file for Chapter 13 bankruptcy in Ohio?

No. There is not an upper income limit on filing Chapter 13. In some Chapter 13 cases, if the income is high enough in relation to the amount of debt, the filer may be required to repay the entire amount which is owed, rather than just a portion of what is owed. However, a Chapter 13 bankruptcy may still allow you to spread your payments out, without interest, over 3-5 years. In addition, you will not have to deal directly with your creditors or collection agencies, but instead will make scheduled monthly payments to your Chapter 13 trustee who will then pay your creditors for you.

Is Chapter 13 the type of bankruptcy that is also referred to as “reorganization bankruptcy?”

Yes. Chapter 13 is often called “reorganization bankruptcy” or “wage earned bankruptcy.”

Am I allowed to repay some of my creditors and to choose to not repay others under Chapter 13?

No. You are not allowed to choose which debts to pay and which ones not to repay. In a Chapter 13, all of your debts will be handled through your Chapter 13 Trustee.

I’m nervous about committing to a Chapter 13 repayment plan. What if, during the course of my Chapter 13 repayment plan, I lose my job or my income is reduced, and I can no longer pay the amount that I am required to pay?

It is very important to contact your attorney if you ever expect to miss a payment, for any reason.

If you are temporarily out of work, injured, or otherwise unable to make the payments required under your Chapter 13 plan, the Court may allow you to suspend payments for a short period of time. If it appears that you will be unable to make your payments due to unemployment, you may need to have your case converted to a Chapter 7.

If I file for Chapter 13 will I have any money left over each month after I make my payment to the trustee? What about money for emergencies such as unexpected medical expenses or car repairs?

You will submit a budget of your income and expenses to the Chapter 13 Trustee which will be approved by the bankruptcy court. This budget will have already accounted for anticipated reasonable expenses.

Is your office experienced at handling Chapter 13 cases?

Yes. We are one of the top bankruptcy and debt resolution law firms in Central Ohio. We provide legal representation for clients in Chapter 13, Chapter 7, debt settlement, and mortgage loan modifications.

Our founding and managing partner, Mark Jump, has been named in Super Lawyers (voted best in our field by our peers) and in Best Lawyers. Mr. Jump has been selected to serve on a number of committees, including the Chapter 13 committee appointed by the bankruptcy Judges to revise and improve the model Chapter 13 plan required to be used by all attorneys.

We pride ourselves on teamwork. All of the attorneys at Jump Legal were invited to join this law firm because of their experience, skill, and dedication to helping people through difficult financial situations. We truly value our relationships with our clients and our reputation in the Central Ohio legal community.

Are your attorney fees comparable to other bankruptcy attorneys’ fees in the Columbus area?

Yes. We also offer payment plans. The fees for bankruptcy cases vary depending on the complexity of the case. During your free initial consultation with one of our attorneys, we will evaluate your case and let you know the cost for representing you and filing your case.

I might be able to qualify for Chapter 7, but I think that Chapter 13 may be a better option for me. How do I know which type of bankruptcy that I should file?

Each case and each client is unique and we understand that. Our experienced team of attorneys will guide you through this decision making process. If you are able to modify your 2nd mortgage and car loans, it may actually save you money to file Chapter 13 instead of Chapter 7. Exploring all options with our clients is always our focus.

Contact one of our Columbus, Ohio area (we have law offices in Columbus, Lancaster, Zanesville & Delaware) law offices to schedule a free consultation with an attorney.

Would you like to read more FAQS on bankruptcy, debt settlement, and mortgage loan modification (stopping foreclosure)? Visit our FAQS page.