Chapter 13

Chapter 13,

Definition of Chapter 13:

  1. Chapter 13 refers to a U.S. bankruptcy proceeding in which debtors undertake a reorganization of their finances under the supervision and approval of the courts. Individuals and married couples, even if self-employed or operating an unincorporated business, are eligible to file for Chapter 13 bankruptcy.

  2. Section of US bankruptcy code under which a debtors future earnings are collected by a court appointed trustee (receiver) and paid to unsecured creditors.

  3. As part of the financial reorganization of Chapter 13, which is also known as a “wage earner’s plan,” debtors must submit and follow through with a plan to repay outstanding creditors within three to five years.

  4. Protection from creditors granted to individuals who legally file for bankruptcy, providing for repayment of debts by a court-approved plan.

How to use Chapter 13 in a sentence?

  1. Chapter 13 is sometimes filed by debtors who want to save their homes from foreclosure.
  2. With a chapter 13 bankruptcy, also known as a “wage earner’s plan,” individuals pay an agreed-upon monthly amount to an appointed impartial trustee.
  3. Already, more than 60% of people who file under Chapter 13 dont complete their plans, meaning they could lose their homes and cars.
  4. As part of the financial reorganization of Chapter 13, the debtor must submit and follow through with a plan to repay outstanding creditors within three to five years.

Meaning of Chapter 13 & Chapter 13 Definition