Chapter 13 Plans is only for Individual Debtors With Regular Income

We had discussed chapter 13 before, but it is very important chapter, and we like to discuss it more in this post. Only individuals may file a chapter 13 plans. Partnership and corporations are ineligible for chapter 13 relief. It is available to any individual with regular income. Chapter 13 is limited to small debtors–people who owe no more than #336,900 in fixed obligations to unsecured creditors and no more than $1,010,650 (recently changed more) in fixed obligations to secured creditors. If the debts are over the statutory limit, the court may change to chapter 7 or dismiss the case. The majority view is that a debtor may not simultaneously maintain a Chapter 7 case and a Chapter 13 case.

How to prepare the Petitions?
A voluntary petition must be filed with the clerk of the bankruptcy court using Official form 1. Individual debtors with primarily consumer debts who are represented by an attorney must complete Exhibit B to the petition. This exhibits which is actually a certification on page 2 of the petition itself is executed by the debtor’s attorney and requires the attorney to declare that he or she has informed the debtor of the availability of Chapter 11, 12, and 13 as alternatives to Chapter 7. The attorney also must certify that the attorney gave the debtor the notice required by Section 342(b) which contains information concerning the purpose, benefits and costs of proceeding. The petition must be signed both by the debtor and the debtor’s attorney Every individual debtor must complete Exhibit C and Exhibit D.

Where to file?Every petition is to be filed in the district in which the debtor was domiciled, resided, had its principal office,or had its principal assets in the United States for more than 180 days before the filing of the petition.

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