Chapter 13


With offices in Cartersville, Calhoun, Dalton and Dallas, the bankruptcy group at Perrotta & Cahn has helped many people in northwest Georgia use Chapter 13 bankruptcy to take control of their debt situation and attain financial stability. Learn more about Chapter 13 bankruptcy here.

Who Should File for Chapter 13 Bankruptcy?

Commonly known as “individual debt adjustment,” “individual debt consolidation,” or simply “repayment plan,” only individuals can file a Chapter 13 bankruptcy. A typical case usually involves people who have fallen behind on their mortgage payments, are delinquent with their priority taxes, or have debts that are generally non-dischargeable in Chapter 7 bankruptcy, such as student loans and child support arrears.

Filing a Chapter 13 bankruptcy plan of reorganization takes into assumption that the individual has a source of income that exceeds his or her household expenses. With this disposable income, the individual is able to fund the plan of reorganization and pay back his or her creditors over a 36 to 60 month plan. The advantage of declaring Chapter 13 bankruptcy is that the debtor is able to force creditors, in a successful plan, to accept his or her terms. These terms afford the individual relief from losing his or her home, risking an IRS or state taxing agency levy, wage garnishments, liens and other methods utilized by creditors to collect on debts.

Income, as understood in the Chapter 13 process, can be wages from employment, self-employment income, social security and disability benefits, interest income, pension income and any other source that provides the debtor with a steady amount of income stream. Income could also be contributions from family members or friends.

Chapter 13 Procedure

If you decide to file for Chapter 13 bankruptcy, a bankruptcy lawyer from our firm will work with you to draft a feasible payment plan, which will be submitted to the Bankruptcy Court. After we file the payment plan, the court appointed bankruptcy trustee holds a creditor meeting to address creditor claims and your financial status. The court then holds a confirmation hearing to determine whether the proposed payment plan is acceptable or if changes need to be made.

Once your payment plan period begins, creditors cannot charge interest on your debts. Rather, all payments go straight to the principal balance of each debt. This way you can pay off your debts as quickly as possible. The Chapter 13 payment plan expires in three to five years, depending on the specifics of the payment plan. At that time, the court generally discharges any remaining unsecured debts.

Attorneys’ Fees for Chapter 13 Bankruptcy

Chapter 13 attorneys’ fees are capped by the U.S. Bankruptcy Court, and are typically paid as a priority administrative debt through the repayment plan. Consequently, a Chapter 13 bankruptcy case can be filed for a small upfront fee, which represents the court filing fee.

Learn More about Chapter 13 from an Experienced Georgia Bankruptcy Lawyer

While bankruptcy should not be taken lightly, it can be a new beginning for you and your family. At Perrotta & Cahn we are committed to helping our clients through the bankruptcy process, offering nonjudgmental advice and working to make bankruptcy proceedings as comprehensible and stress-free as possible. For more information about your options under bankruptcy law, please contact us for a free initial consultation.