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1- Overview

One of the first questions you will be asked when you sign your paperwork and perhaps at your Trustee's meeting is whether I have told you about the various chapters of bankruptcy.  So I'm telling you now.

Chapter 13 is a section of the Bankruptcy Code which helps qualified individuals, or small proprietary business owners, who desire to repay their creditors but are in financial difficulty. It is sometimes referred to as a "mini Chapter 11" because of the $750K and $250K limits - whether you are over or under $750K in secured debt and $250K in unsecured debt - if over, you can go chapter 11, if under, you can go chapter 13.  Chapter 13 is a lot simpler and cheaper.

Chapter 13 is one of the payout chapters, in which you usually repay something to your creditors and you retain your property and make payments under a Plan.

Chapter 13 requires regular monthly income, so you can make the monthly Plan payment.

Chapter 12 is a payout for farmers, who usually do not have regular monthly income.

Chapter 7 by contrast, is a liquidation with no payout. 

So Chapters 13, 12, 11 & 7 are the ones you need to know about.  This presentation  focuses on Chapter 13.