Do I Have Too Much Debt for Chapter 13 Bankruptcy?

If you are filing a Chapter 7 bankruptcy, you can have limitless amounts of debt. No matter how much you owe, your debts will be alleviated. Of course, that doesn’t come without consequences. To learn much more about the implications and outcomes of a straight Chapter 7 bankruptcy, read our complete guide to filing Chapter 7 bankruptcy in Iowa. While Chapter 7 is perhaps the most commonly known type of bankruptcy, those considering bankruptcy in any form should at least familiarize themselves with Chapter 13 bankruptcy.

Chapter 13 bankruptcy essentially acts as alternative to the traditional form of bankruptcy. Rather than wipe all debts from your name, Chapter 13 creates a three-to-five year plan to repay your debts at lower prices and with better rates. While you are still filing for bankruptcy, Chapter 13 allows you to repay your debts with the protection of a bankruptcy court and without the constant pressure from creditors. Marks Law Firm has helped Iowans successfully file and follow through with Chapter 13 bankruptcies for decades.

If you are reading this for the first time, you might ask, “Why doesn’t everyone file for Chapter 13?” The answer is simple: not everyone is qualified for Chapter 13. To qualify for Chapter 13, you must get your payment plan approved by a bankruptcy court, which will impose strict limits on how much debt you can have for a Chapter 13 bankruptcy. As of now, the national limit for Chapter 13 bankruptcy is just over $360,000 in unsecured debts and just below $1.1 million in secured debts. This limit will increase by an undetermined amount in April 2013.

Now you might be reading this right now and thinking several different things. You might not know which of your debts are secured or unsecured. You might not know how exactly how much debt you owe to your creditors. You might also be confused still about the difference between Chapter 13 and Chapter 7. If you have any and all of these questions, or if you’re considering filing Chapter 13 bankruptcy, call our office at 515-276-7211 to set up a free consultation with Attorney Sam Marks. Sam is one of the most experienced, helpful, and compassionate bankruptcy attorneys in central Iowa, and he has been serving the Des Moines community and beyond for many years. Sam will personally meet whenever is most convenient for you to review your debts and your financial situation. There is no risk to take advantage of a free consultation with our staff, so contact us right now!

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