Chapter 13 Bankruptcy

In this article, we will explain how Chapter 13 bankruptcy repayment plans work, define the different classes of creditors, explain how each class of creditor must be treated under the repayment plan, and explain how the length of the repayment plan is determined.

The automatic stay is activated when bankruptcy is filed. The automatic stay puts nearly all creditors and debt collection actions on an equal playing field and gives the filer a much-needed break as they work with a bankruptcy attorney on the best solution to their debt problems. However, an automatic stay order is not all powerful. Many types of collections will be temporarily put on hold, but there are exceptions; the timeframe also depends on the type of bankruptcy and the filer’s overall financial situation.

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This article will discuss how those that qualify for a Chapter 7 bankruptcy can be eligible for a Chapter 13 bankruptcy zero percent plan and save their home and car. We will answer the following questions: what is the difference between Chapter 7 and Chapter 13 bankruptcy?, what is a zero percent plan?, what does the debtor pay in a zero percent plan?, how does the Mean's Test determine eligibility for a Chapter 13 zero percent plan?, and is a zero percent plan still an option if I have too much equity?

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