A client will typically say, “I can’t file a Chapter 13 Bankruptcy, I have too much debt, there’s no way I can pay all that back!”   The answer is, you don’t have to.

Generally speaking, Chapter 13 is for people for:

-Whose household income will not allow them to file a Chapter 7 and/or whose assets are over what Florida exemptions allow you to keep in a Chapter 7.

-Chapter 13 is great for people who are behind on their mortgage or car payments and they want to play catch up over a period of 36-60 months.

-Chapter 13 can sometimes stop interest and penalties on IRS debt, and save the debtor money by paying the IRS debt through a Chapter 13 bankruptcy.

-Chapter 13 is a good option for stripping Junior liens on Real Property if the value of the real property is less than you owe on the First Mortgage.

-A Chapter 13 Bankruptcy is not for the debtor to pay back 100% of their debt. This bankruptcy is designed to allow the debtor to pay back a portion of their debt given the analysis of the unsecured debt, secured debt in arrears, their net disposable monthly income, and the value of their assets. A lot of factors come into play such as household income, household size, the median income of that State, assets, and unsecured and secured debt. Seek legal guidance, and know your options.

Sherry Ellis