1. Chapter 13 is designed for individuals to make plan payments. Some fraction (or in a limited number of cases, all) debts can be paid in installments over a period of time of up to 60 months. Even when debts are paid, interest and penalties may be greatly reduced on certain types of obligations.
2. Under chapter 13, you must file with the court a plan. The court will decide whether to approve your plan, however creditors will be stayed when the case is file unless you have filed bankruptcy before. Thus Chapter 13 is useful to stop foreclosures, wage garnishments, and bank levies immediately.
3. After completing your plan, your debts are generally discharged except for domestic support obligations; most student loans; certain taxes; most criminal fines and restitution obligations; certain debts which are not properly listed in your bankruptcy papers; certain debts for acts that caused death or personal injury; and certain long term secured obligations.
4. Generally you will only need to appear at the courthouse one time before your plan is confirmed.
5. In a Chapter 13 case, your attorney can put most fees into the Chapter 13 plan so your upfront cost of filing is very low. This makes Chapter 13 available to nearly everyone.
6. In some Chapter 13 cases, general unsecured creditors like credit cards and medical bills receive only a very small repayment or no repayment. This depends on your income and assets. A good attorney will advocate for the lowest plan payment possible.
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