What are the Qualification for Chapter 13 Bankruptcy?
1. Debt Limitation.
You can have so much debt to qualify for Chapter 13 Bankruptcy. As of 2018, the current debt limitations are as follows: $1,184,200 for secured debts and $394,725 for unsecured debts. Secured debts are debts that are secured by collateral like mortgage or car loans or auto title loans so that if you fail to make timely payments, your lender can take away the collateral. Unsecured debt are debts that are not secured by collateral like credit cards and medical bills so that if you do not timely pay your bills, they do not take away your property.
2. Steady Income.
You need a steady income to make your Chapter 13 Bankruptcy plan payments for a period of 3 to 5 years. Income can be from a job, business, social security, alimony, child support, unemployment, worker's compensation, disability payments, etc. Income can also be from your spouse even if she or he is not filing bankruptcy with you.
3. File Your Tax Returns.
4. Not a Business Entity.
Business entities cannot file Chapter 13 Bankruptcy. Chapter 13 Bankruptcy is for individual or sole proprietorship. A corporation, limited liability company, partnership cannot file for Chapter 13 Bankruptcy because they are business entity. Moreover, stockbrokers and commodity brokers cannot file for Chapter 13 Bankruptcy even if they only have personal debts.
For more information about the qualification of Chapter 13 Bankruptcy, schedule a bankruptcy consultation with Muoi Chea, experienced Sacramento Bankruptcy Attorney. For a decade she has help eliminate and restructure debts under Chapter 13 Bankruptcy and Chapter 7 Bankruptcy for residents of Fairfield, Lodi, Galt, Elk Grove, Citrus Heights, Vacaville, Vallejo, Fair Oaks, Stockton, and Sacramento, CA.