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How do I qualify for Chapter 13 bankruptcy?

Residents of Wisconsin facing financial challenges may be desperately looking for relief. Overwhelming debt can leave you stressed out about your future, which in turn can negatively affect your daily life. Fortunately, debt relief can be found through the bankruptcy system. However, in order to take advantage of the relief offered by the law, you have to qualify.

Chapter 13 bankruptcy, which can reorganize your debts into more manageable payments, can be extremely helpful to those who want to keep their assets. But how do you qualify for Chapter 13? First of all, your unsecured debts, meaning those for which there is no collateral (like credit card debt), cannot be more than $383,175. Second, your debts that are secured, like a mortgage, cannot exceed $1,149,525. Also, within 180 prior to filing for bankruptcy, you must receive credit counseling.

There are other ways that you can be disqualified from filing for Chapter 13 bankruptcy. For example, if, within the 180 days preceding your filing, you had a bankruptcy petition dismissed because you failed to appear in court or you failed to comply with the court's orders, then you may be deemed unable to avail yourself of the bankruptcy laws.

There are a lot of things to consider when deciding whether to file for bankruptcy. You also have to consider which debt relief option is best for you, your family and your future. Since this post does not provide legal advice, by working with a Wisconsin bankruptcy attorney you might be able to put together a plan with which you feel comfortable and competent.

Source: United States Courts, "Chapter 13 - Bankruptcy Basics" accessed Oct. 5, 2015

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