What is a Chapter 13 Bankruptcy in California?

Chapter 13 bankruptcy is commonly known as Reorganization. This is the bankruptcy provision is most often pursued by those consumers who are unable to qualify for Chapter 7 and who wish to keep their assets. In Chapter 13, the debtor must make monthly payments over three to five years to repay all or some of their debt. Once all payments are made under the repayment plan, the debtor is entitled to a discharge of their debts.

How does a Chapter 13 Work?

Within 15 days after filing a Chapter 13 petition, the debtor must file a proposed repayment plan. A summary of it is mailed to every creditor. Once the plan is confirmed, the debtor makes payments to the trustee for the benefit of the creditors.

Who Qualifies for a Chapter 13?

This section of the Bankruptcy Code typically helps qualified individuals who don’t qualify for Chapter 7, qualified individuals who want to retain his/her property, or small proprietary business owners. Only an individual with regular income whose debt is under $1,000,000 ($250,000 unsecured debt; $750,000 secured debts.) A qualified individual must have a regular source of sufficient income to make Chapter 13 plan payments and stay current on secured debt obligations (mortgage) and living expenses.

Disadvantages of Chapter 13

  • Your repayment plan last for years – 36 to 60 months.
  • Higher legal fees for filing this chapter.
  • If you miss any payments due under your Repayment Plan, your case will be dismissed by the Court.
  • You must stay current on your Chapter 13 Plan payments and payments to secured creditors (i.e. mortgage).
  • Secured debts (mortgage) must be repaid in full, but Chapter 13 Plan payment allows you to cure the defaults by repaying any arrearages over the life of the Plan.

Advantages to Chapter 13

  • You keep your real estate and personal property.
  • You have protection against creditor collection efforts, lawsuits and garnishments.
  • You have protection against foreclosure of your home.
  • You have the opportunity to repay your debts through reduced payments.

Chapter 13 Bankruptcy Cost

Please contact Brownstone Law Group, PC. to discuss costs associated with Bankruptcy as they vary based on your particular circumstances.

CONTACT US TODAY

Get in touch to learn how we can help.

Ready to Be Debt Free?

Do you consent to electronic communications?*
I consent to receive electronic communications from Brownstone Law Group and it's affiliates. And I agree that all agreements, notices, disclosures and other communications that Brownstone Law Group and it's affiliates provide to me electronically, via email, via phone and on the Site, satisfy any legal requirement.
This field is for validation purposes and should be left unchanged.

Why Choose Us?

  • A Rating With the Better Business Bureau 
  • Charter Member Of the Business Consumer Alliance With an AAA Rating
  • Licensed With the State Bar of California
  • Many Satisfied Debt Free Clients
  • Hands-On Approach Providing Personalized Service To Each Client
  • Flexible Program Terms Custom Tailored To Each Client

This is an attorney advertisement and this website is for informational purposes only

The information contained on this website is not to be construed as legal advice. It is not intended to solicit or form an attorney-client relationship. Debt settlement, debt negotiation or debt resolution programs (the “Program”) are not an offer or promise to lend money and neither they nor Brownstone Law Group, PC. (“BLG”) assume or pay any consumer debt or make monthly payments. BLG is not affiliated with any lending institution, bank, collection agency or collection law firm. Individual Program results may vary and are based on but not limited to the ability of clients to save funds and successfully complete their Program terms and conditions, the amount and type of debts and creditors, history of accounts and financial standing of clients. Past performances of Clients do not guarantee future results for others and BLG does not guarantee that debts enrolled in the Program will be settled at a specific percentage or amount, or that you will be debt free within a specific time period. Not all Clients complete our Program for a variety of reasons including but not limited to an inability to save sufficient funds. The Program may have an adverse impact on Clients credit. Our services may not be available in all states please check with BLG for state eligibility. Please contact a tax professional to discuss potential tax consequences of settling debt. This website and the content of this website has been reviewed and approved by Thomas A. Moore the managing partner of BLG who’s mailing address is PO Box 629, Orange CA 92856-6629. Copyright Brownstone Law Group, PC. All rights reserved. Unauthorized use of the BLG website includes but is not limited to content copying, duplicating or replicating is strictly prohibited. Furthermore, use of this website is subject to the Terms of use.

State Bar of California
A+ BBB Rating
Consuner Alliance Member
Dun & Bradstreet Registered