Chapter 13 bankruptcy proceedings are open to any borrower who meets the requirements. If you'd like to know if you qualify for this option, in which you'll devise a monthly payment plan with the bankruptcy court, keep reading.
Key requirements for Chapter 13 bankruptcy include the following:
You're not a business: Only individuals and married couples can file for Chapter 13 bankruptcy. If you have a limited liability company or a corporation, the bankruptcy procedure will be Chapter 11, not 13. The only exception to this rule is if your business is a sole proprietorship.
You're not barred by time limitations: If you filed a Chapter 13 bankruptcy inside the last 24 months or a Chapter 7 bankruptcy inside the last 48 months, you're out of luck. You will need to wait before you can file for Chapter 13.
Furthermore, if you suffered a bankruptcy dismissal inside the last 180 days due to violating court orders, failing to show up in court or because you asked for dismissal after the court agreed to lift the automatic stay, you will be ineligible.
You have sufficient income: You need to be making a consistent income that's high enough to repay a certain amount of your debt via the monthly debt repayment schedule. If you don't have a stable income that's high enough, Chapter 13 bankruptcy isn't right for you.
There are other requirements for filing for Chapter 13, but these are three of the most important ones. If you're curious about whether you can use Chapter 13 to get out from under your debt, a Washington bankruptcy attorney can provide valuable guidance.