Getting Deeper In Debt? 3 Ways That Chapter 13 Bankruptcy Can Give You A Fresh Start

Financial hardships can happen at any time. No matter how much you plan, things like divorce, medical problems, or deaths in the family can take the stability right out of your financial planning. When that happens, your monthly income might not be enough to keep you out of debt.

If you've suddenly found yourself in debt, there is a way out. Chapter 13 bankruptcy, a bankruptcy for people with a stable income, can give you the time you need to repay your debts. It can also give you the fresh start you need. Here are a few things you need to know about chapter 13 bankruptcy.

Keep Your Assets

Unlike with chapter 7 bankruptcy where you have to forfeit most of your property, chapter 13 allows you retain ownership of all your assets, including real and personal property. This means that all the property that you've acquired will remain in your possession.

Pay Over Time

Once you've filed for chapter 13 bankruptcy, you will enter into a repayment agreement with the courts. In most cases, you'll be given from 3–5 years to repay your debts. A bankruptcy trustee will be assigned to your case. The trustee will ensure that your payments are made on time and that they are properly credited to your debts.

At the end of the repayment period, you will go back to court. If you've made all of your required payments, any remaining debt will be forgiven. However, if you haven't made all of your required payments, the judge may dismiss your case. If that happens, you'll be required to pay back all of your outstanding debt.

Restore Your Credit

Your credit is one of the most important assets you have. With good credit, you can secure loans for homes and automobiles. While bankruptcy will show on your credit report for up to ten years, once that time is up, your credit will be restored, and you will have the fresh start that you needed.


Most of your debt can be discharged through bankruptcy. It's important to note that there are some debts that cannot be forgiven. These debts include:

  • Federal taxes that are in arrears

  • Child support

  • Spousal support

  • Most student loans

There are some instances where your student loans may be discharged. Your bankruptcy attorney will be able to determine if your loans can be discharged.

If you've suddenly found yourself in debt and can see no way out, help is available. Your bankruptcy attorney, Wagner Law Office PC, will help you through the process. With chapter 13 bankruptcy, you can get out from under your debt.

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