Getting Your Finances Back On Track

What you should know about Chapter 13

On Behalf of | Jun 14, 2023 | Bankruptcy, Blog

Your right to file for Chapter 13 bankruptcy in Tennessee will be subject to certain conditions. There are a number of legal and practical requirements that you will be required to meet. This type of bankruptcy may be right for your needs if you are currently struggling with high debt. It can last on average from three to five years.

Qualifying for Chapter 13

You can file for a Chapter 13 as an individual. Sole proprietors are eligible, but corporations are not. You must also have a clear record with regard to bankruptcy discharges. This means that you are ineligible if you have filed for Chapter 13 within the last two years. You are also ineligible if you have filed for Chapters 7, 11 or 12 within the past four years.

You also need to have a clean record when it comes to previous bankruptcy discharges. If you filed a previous petition that was dismissed within the past 180 days, you may be declared ineligible. This will apply especially if you were found to have violated a court order to appear before them in a timely manner.

Payment plans

Before you can get your Chapter 13 filing approved, you’ll need to prepare a payment plan. You can work with your adviser to come up with a plan that shows how much you can pay and how long you will take to do so. If your plan is approved, you will need to be able to show that you can stick to it.

You will also need to be up to date on all of your income tax return filings. You must file all state and federal income tax returns that are expected to become due while your case is ongoing.

The ultimate goal will be to discharge as many of your debts as possible. These may include credit cards, medical bills, certain types of lawsuit judgments, unsecured personal loans and others. Chapter 13 can provide a road map for getting yourself out of debt.