Chapter 13 Bankruptcy

What is Chapter 13 Bankruptcy?

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In a chapter 13 bankruptcy, the debtor is permitted to retain the debtor’s assets. However, the debtor must re-structure and re-pay a certain amount of the debts to the creditors, typically over a period of 3 to 5 years. A re-payment plan must be approved by the Bankruptcy Court. Payments made by the debtor under the re-payment plan are made to the trustee who then distributes the funds to the debtor’s creditors. Chapter 13 bankruptcy can be a good way to eliminate certain debts and to retain certain assets.