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11 USC 528 Disclosure:  The Law Office of Stephen B. Carruthers is a debt relief agency that helps clients file for bankruptcy relief under the Bankruptcy Code. The information on this website is not, nor is it intended to be, legal advice. In order to obtain legal advice regarding your specific situation you are encouraged to contact an attorney. No contact information received through this website will be handed out or sold to any second party.


Serving the following North Carolina Counties: Henderson, Transylvania, Polk, Buncombe, Avery, Mitchell, Yancey, Madison, Haywood, Jackson, Macon, Clay, Swain, Graham, Cherokee, McDowell, Burke, Rutherford & Cleveland.

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Chapter 13 Bankruptcy


Chapter 13 bankruptcy is available to individuals with regular income and allows debtors to keep their property by proposing a repayment plan to creditors.  In a Chapter 13 case, debtors propose a repayment plan that lasts between 3 and 5 years and repays creditors some, or all, of what is owed, using funds from the debtors' future income.  Because chapter 13 cases propose to repay creditors, greater relief is available, including: stopping a foreclosure or repossession and catching up on mortgage/vehicle payments; lowering the interest rates on vehicles; restructuring certain tax debt and curing alimony and child support arrears.  

In a chapter 13 case, creditors are entitled to as much as they would have received if you had filed chapter 7.  Therefore, through the duration of your chapter 13 plan, you must pay creditors the value of your non-exempt assets.  Some of the reasons why chapter 13 may be a better alternative than chapter 7 include:


  • Stopping a foreclosure or repossession and to catch up on your mortgage or vehicle payments

  • You have non-exempt assets that you might lose if you file chapter 7

  • Curing delinquent domestic support obligations

  • You have significant tax debt that can be restructured in chapter 13

  • You are "underwater" on a vehicle or wish to reduce the interest rate on a vehicle

  • Your household income is too great to qualify for chapter 7 

  • "Stripping off" a wholly unsecured second or third mortgage on your principal residence.


During your chapter 13 case you are still required to make payments on your secured debt (and certain other obligations), but unsecured creditors are paid only a percentage of what they are owed (based on your disposable income and non-exempt assets).  All of your payments, including fees paid to your bankruptcy attorney can be paid through your chapter 13 plan, requiring little up-front funds in order to file under chapter 13.  Certain clients may be eligible for $0.00 money down filing, resulting in no up-front attorney's fees.  Before you commit to filing under chapter 13, it is possible to estimate what your monthly payments would be under the plan, making it easier to decide whether chapter 13 would be feasible.


To schedule a free consultation to learn whether chapter 13 would work for you, contact The Law Office of Stephen B. Carruthers.

To learn more, go to Bankruptcy FAQs.